Private credit paper losses hit steepest level since 2022
A Reuters study of 51 business development companies found unrealized losses reached 2.35 percent of net asset value. Analysts warn of credit deterioration.
Private credit lenders saw aggregate unrealized losses deepen to 2.35% of net asset value during the first quarter of 2026. This represents the steepest quarterly hit for the sector since the second quarter of 2022. Rising paper losses and slowing asset growth signal that underlying portfolio stress is finally surfacing for global investors.
### Deteriorating Fundamentals in the BDC Complex A Reuters analysis of 51 business development companies (BDCs) in the United States revealed that paper losses are widening as market concerns over AI disruption and profitability grow. Analysts at BANK OF AMERICA CORP identified a modest but unmistakable credit deterioration across the sector. The analysts noted that assets under management are stagnating while earnings contraction begins to outpace growth.
