US private equity giant KKR slumps to £677m loss

KKR has suffered the biggest hit to its balance sheet since March 2020 after posting a loss of £677million for the second quarter.

The drop-off for the private equity giant comes after a turbulent few months for global markets and a slowdown in dealmaking, which has hit the New York firm’s vast portfolio.

KKR’s latest quarterly results revealed a 7 per cent fall in the value of its private equity holdings, while its fee-related earnings were down 2 per cent year-on-year to £377million.

Earnings also slid 9 per cent year-on-year to £687.7million.

Management highlighted a fall in transaction fee income, which was caused by the ‘volatility’ of Russia’s war in Ukraine and rising interest rates. 

Yet KKR’s partners still benefited £592million in quarter two from so-called carried interest – a controversial way that private equity partners pay themselves. 

Total assets under management increased to £401billion.