The “cockroach issue” was a “self-serving comment” related to the two bank deals rather than a deeper private debt problem, according to Anthony Fobel, chief executive of Arcmont Asset Management.
At Nuveen Private Capital’s press conference earlier this week, Fobel (pictured left) said he was “disappointed” by recent comments on private equity returns, highlighting his firm’s 0.1 percent asset rating and 15 consecutive quarters of EBITDA growth for the portfolio.
He said the performance of the private credit industry was “very strong” and that people were combining different issues.
His comments come at a challenging time for the popularity of the private credit market, amid investor disputes in the US over software disclosures and concerns about underwriting standards after high-profile corporate bankruptcies left lenders out of pocket last year.
In October 2025, JP Morgan boss Jamie Dimon warned that the bankruptcies of auto lenders Tricolor and First Brands were symptomatic of wider problems in the private credit sector, saying, “if you see one cockroach, there are probably more”.
Read more: “One cockroach does not make a habit”
Fobel disputed the cockroach analogy, saying: “What do those banks want to do? To create private debt funds.”
Ken Kencel (pictured right), chief executive of Arcmont’s sister company, Churchill Asset Management, also defended the sector. He noted the state of private credit in the money stack above private equity, saying “the narrative is upside down”.
He highlighted Churchill’s recent record raising of $16bn (£11.8bn) for his high-profile lending strategy, a $5bn commitment in the first quarter and record levels of investment activity.
Software problem
Arcmont and Churchill are collectively 98 percent institutionally funded and therefore have not had to deal with the outflows and fundraising that some American managers have experienced recently due to concerns about the private debt exposure of software companies, which are vulnerable to the rise of artificial intelligence (AI).
Kencel said Churchill’s overall software exposure is five percent of its portfolio, with just one percent of its companies exposed to AI risk.
Arcmont’s software exposure accounts for 15 to 20 percent of its portfolio, Nobel said, with eight percent of that potentially vulnerable to AI disruption.
It was suggested during the event, which was held in London, that the rapid increase in retail investment in private debt had put some managers under pressure to release funds too quickly, with Kencel saying he had seen managers “backing away” from large software lending.
However, Nobel stressed that software is “a good part of a portfolio if you do the right deals” and noted that “software has not confused institutional investors”.
Separately, both executives criticized the rise in payday loans, saying the institutions were being used to replace equity investments in early-stage, high-growth companies that couldn’t pay their debts.
