Apr. 8 at 1:23 PM
Moody’s Ratings changes its outlook for the BDC sector from stable to negative, as funds face increasing redemption pressure.
Revised outlook reflects rising redemption requests at perpetual non-traded (PNT) BDCs, elevated leverage at publicly traded BDCs, and weakening access to unsecured debt & equity markets
However, while the sector outlook has shifted, its ratings outlooks on individual BDCs remain predominantly stable. This is due to the continued emphasis on first-lien, senior secured lending, as well as generally adequate liquidity & laddered maturities.
Across the entire BDC sector, which has total assets of around
$400B, despite strong net inflows throughout 2025, sector has recorded its 1st-ever net outflow in early 2026. Many PNTs have reported quarterly redemption requests exceeding 7% to 10%, w/ 1 rated BDC seeing requests above 40%
Across the sector, many BDCs have experienced redemption requests
Pressure falls most acutely on non-traded BDCs
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