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Private Credit and BDC Stress. Discounts at 13-Year Lows. Withdrawals Past the Gate. Regulators Now Arriving.

Published: June 6, 2026

Private Credit & BDC Stress. The median listed BDC trades at 25% discount, near its deepest discount in 13 years (excl. Covid). Loss rate projections are up to 10%. And withdrawal requests just blew past the redemption gates at Blackstone and Cliffwater.

The regulators have started arriving. Federal prosecutors in New York are questioning BlackRock executives over how their credit fund valued its loans. The FSB calls private credit's leverage and interconnections a source of "broader risks to financial stability." The ECB has put US private credit on its watchlist as a spillover risk into Europe.

And then the central banker line. Sarah Breeden at the Bank of England has called it a potential "market for lemons" (Akerlof's).

TIGZIG - BDC & Private Credit - tigzig.com to TREMOR to Private Credit. The median listed BDC trades at 25% discount, near its deepest in 13 years (excl. Covid). Partners Group warns the redemption pressure that began in private credit is now spreading into private equity. 0.75x price to book today. Pimco's CIO: the first sustained default or loss cycle in many, many years. FS KKR $441M Q1 loss; Blue Owl's BDC $184M Q1 loss. Withdrawal requests blew past the 5% cap - ~10% at Blackstone's BCRED, 17% at Cliffwater; first-ever net outflow. Private-credit rating downgrades up 50% in a year. UBS sees defaults rising from ~4.4% to 9-10% by end-2026. US issuance fell ~40% vs Q1 - $44.8B in the 3 months to May.

Read the deeper analysis

Is Private Credit Turning Into a Lemon? Bank of England Says So. Default Rate at a Record 6.0%. Banks and Insurers Deep In It

Deeper dive into Private Credit and Bank lending to non-banks here: tigzig.com → TREMOR → Private Credit

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TIGZIG · BDC & PRIVATE CREDIT  |  Amar Harolikar

tigzig.com → TREMOR → Private Credit

The median BDC trades at a 25% discount, near its deepest in 13 years (excl. Covid)

Partners Group warns: the redemption pressure that began in private credit is now spreading into private equity.

Median price-to-NAV · listed US BDCs · weekly, 2013 to 3 Jun 2026

Method: 46 listed US BDCs. Price-to-NAV = unadjusted daily close (Yahoo Finance) over latest-filed NAV/share (SEC EDGAR, us-gaap:NetAssetValuePerShare), stepwise between filings; equal-weighted median, on Q1 2026 NAV. Dotted line = NAV.

0.75x — price to book, today.

Pimco's CIO: "the first sustained default or loss cycle in many, many years."

An update · the past few weeks

ThemeWhat's happening
The lossesFS KKR: $441M Q1 loss; Blue Owl's BDC: $184M Q1 loss.
The exitWithdrawal requests blew past the 5% cap — ~10% at Blackstone's BCRED, 17% at Cliffwater; a first-ever net outflow.
DowngradesPrivate-credit rating downgrades up 50% in a year.
Loss outlookUBS sees defaults rising from ~4.4% to 9-10% by end-2026.
LendingUS issuance fell ~40% vs Q1 — $44.8B in the 3 months to May.

Sources: news reports across CNBC, Reuters, Morningstar DBRS, PitchBook and UBS · late May to early June 2026.

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Amar Harolikar · Decision Sciences & Applied AI · builder of tigzig.com