Private capital monitor: Media narratives v the hard reality | June 3, 2026 | Deutsche Bank Research Institute

Executive summary by Deutsche Bank Research Institute:

• Private capital managers' confident Q1 performance is a stark contrast to the media and investor narratives that have focussed on concerns about credit quality, Al disruption and redemptions. We take a closer look at what this divide means for PC in 2026.

• Al disruption: Our risk scoring and indexes show that PC managers were more worried about the 2022-23 rate rises, but today, the media is far more worried about Al.

• Overall in Q1, PC managers became more attuned to various external risks including Al disruption. Still, the large managers remain confident about their portfolios and fundraising.

• Managers emphasised that retail fundraising woes have been more concentrated and less severe than the media presents.

• We show our proprietary survey of individuals in the UK and the US that highlights the virality of negative headlines in the financial press.

• We track decompression in BDCs' non-accrual rates to show that the deterioration comes after quarters of strong growth. Thus, further defaults will require significant stress in the equity layer.

• We continue to expect PC dealmaking to recover as the most intense adverse headlines subside.