Steep NAV declines and federal probe prompt a move higher at BlackRock.
The most difficult private debt market in years has sought its first major leader in a major asset manager.
BlackRock's Phil Tseng is in the process of stepping down as CEO of the publicly traded business development company, according to Bloomberg News.
The move comes amid a brutal year for BlackRock TCP Capital Corp. The company marked its total asset value twice in 2026 – by 19% in January and another 5% in May. Meanwhile, federal prosecutors in Manhattan were reportedly investigating the fund and questioning executives as part of the investigation.
Tseng, an acqui-hire from BlackRock's 2018 purchase of Tennenbaum Capital Partners, is currently active with no set departure timeline.
Tseng's exit echoes a pattern that emerged last fall when two related lenders defaulted and scrambled private lenders. Cleveland-based First Brands filed for Chapter 11 in September after undisclosed off-balance-sheet financing clouded recovery levels beyond what lenders had written. Founder and CEO Patrick James stepped down as bankruptcy occurred.
That same month, subprime auto lender Tricolor Holdings went into foreclosure. Federal prosecutors later charged founder and CEO Daniel Chu and chief operating officer David Goodgame, saying the pair misled lenders to keep lines of credit open. Goodgame pleaded guilty in June to six counts, including bank fraud and conspiracy, and is now cooperating with prosecutors — a deal that could put him in the spotlight against Chu, who has pleaded not guilty. Chu also abruptly resigned from Origin Bancorp's board before Tricolor was hired.
Industry executives largely portrayed the two collapses as isolated cases of fraud rather than evidence of systemic corruption. Blue Owl co-president Craig Packer told CNBC in October that the failure was “not a private debt issue” at all.
BlackRock CEO Larry Fink struck a similar tone of confidence. On an earnings call in April, he told analysts that demand for a private credit facility is “growing.” However, the headlines in this industry do not reflect the company's customer and portfolio data.
Issuances from business development companies, key lenders in the private equity market, are on the rise. Investors requested $20.8 billion in redemptions in the first quarter alone. In some cases, that release exceeded the 5% limit set by BlackRock and its competitors: Apollo Global Management, Ares Management, Blackstone, Blue Owl Capital, and KKR.
Not all private equity funds seem to have problems. Goldman Sachs' private credit fund, for example, honored all redemption requests in Q2 because it reported limited private equity fund redemption requests (3.2%). The same goes for Nuveen Churchill and Oaktree with withdrawals of 3.1% to 4.5%, respectively.
But with many industry players posting losses, Tseng's departure suggests the numbers are reaching the organizational chart.
