Financial Data and Key Metrics Changes - Adjusted net investment income for Q4 2025 was $35.4 million or $0.40 per share, up from $32.5 million or $0.37 per share in the prior quarter, reflecting a return to normalized prepayment fees and lower interest expenses [4][16] - NAV per share decreased to $16.64 from $16.76 in the previous quarter due to unrealized depreciation on certain investments [16] - Adjusted total investment income increased to $76.9 million compared to $74.3 million in Q3, driven by higher prepayment fees and dividend income [16] Business Line Data and Key Metrics Changes - New-funded investment commitments amounted to $220 million, up 54% from the prior quarter, with prepayments totaling $177 million [10] - First-lien loans represented 88% of new originations, indicating a focus on senior-secured loans [10] - Over 40% of portfolio companies were marked up by about 70 basis points, reflecting improving fundamentals [12] Market Data and Key Metrics Changes - Private credit deal flows showed modest improvement, but the quality of deals was mixed, with a steady supply of high-quality opportunities alongside lower-quality deals [7] - The weighted average spread on deployments during the quarter was approximately SOFR plus 570, indicating competitive pricing in the market [10] - The company noted a cautious optimism regarding private credit spreads, suggesting they may have bottomed out at SOFR plus 450 [8] Company Strategy and Development Direction - The company aims to prudently increase balance sheet leverage to enhance earnings power and deploy capital into interesting investment opportunities [6] - Focus on optimizing joint ventures and reducing non-accruals in equity positions to improve earnings power [6] - The long-term outlook on private credit remains bullish, with expectations for continued premium spreads relative to other floating-rate asset classes [8] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about the current market environment, noting mixed themes and ongoing political and economic uncertainty in Europe [7] - The company does not expect outsized repayments for the December quarter and anticipates deployment levels to remain consistent with past quarters [22] - Management highlighted ongoing operational workouts for long-standing non-accruals, focusing on driving performance and maximizing value [31] Other Important Information - The company has ample liquidity of approximately $695 million, including $80 million in cash and $615 million in undrawn capacity on its credit facility [18] - The leverage ratio at quarter end was 0.97 times, slightly up from 0.93 times in the previous quarter, indicating a conservative leverage approach [17] Q&A Session Summary Question: Expectations around investment activity in the December quarter - Management does not expect any outsized repayments and anticipates deployment levels to remain consistent with past quarters [22] Question: Insights on the yield increase related to the Walgreens deal - The yield on new investments was higher due to the complexity of the Walgreens deal, but management does not foresee similar high-spread opportunities in the near term [23][25] Question: Status of non-accruals in healthcare and pharma - Management acknowledged a few larger positions in life sciences that are undergoing workouts, with stable to slightly improving conditions [29][30] Question: Workout strategies for long-standing non-accruals - Operational improvements are being made, with management working closely with teams to drive performance and maximize value [31]

Financial Data and Key Metrics Changes - Adjusted net investment income for the fourth quarter was $35.4 million or $0.40 per share, up from $32.5 million or $0.37 per share in the prior quarter, reflecting a return to normalized prepayment fees and lower interest expenses [4][16] - NAV per share decreased to $16.64 from $16.76 in the third quarter due to unrealized depreciation on certain investments [16] - Adjusted total investment income increased to $76.9 million compared to $74.3 million in the third quarter, driven by higher prepayment fees and dividend income [16] Business Line Data and Key Metrics Changes - New-funded investment commitments amounted to $220 million, up 54% from the prior quarter, with first-lien loans representing 88% of new originations [10][12] - Weighted average yield on debt investments was 9.8%, with the median EBITDA of portfolio companies at approximately $150 million, a decrease of $11 million from the prior quarter [12] Market Data and Key Metrics Changes - Private credit deal flows showed modest improvement, although the quality of deals was mixed, with a steady supply of high-quality opportunities alongside lower-quality deals [7][8] - The weighted average spread on deployments during the quarter was approximately SOFR plus 570, with a tightening of the illiquidity premium observed [10][8] Company Strategy and Development Direction - The company aims to prudently increase balance sheet leverage to enhance earnings power and deploy capital into interesting investment opportunities, maintaining a conservative leverage ratio of 0.97 times [6][16] - Focus on optimizing joint ventures and reducing non-accruals in equity positions to improve earnings power [6] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding private credit spreads, indicating that they may have bottomed out at SOFR plus 450 [8] - The long-term outlook on private credit remains bullish, with expectations that private debt will continue to deliver a premium spread relative to other floating-rate asset classes [8][9] Other Important Information - The company has ample liquidity of approximately $695 million, including $80 million in cash and $615 million in undrawn capacity on its credit facility [18] - The company received a $525,000 dividend from its joint venture during the quarter [18] Q&A Session Summary Question: Expectations around investment activity in the December quarter - Management does not expect any outsized repayments for the December quarter and does not foresee significant deviations in deployment or leverage levels compared to past quarters [21][22] Question: Insights on the yield increase related to the Walgreens deal - The yield on new investments was higher due to the complexity of the Walgreens deal, but management does not anticipate similar high-spread opportunities in the upcoming quarter [23][24][25] Question: Status of non-accruals in healthcare and pharma segments - Management noted that there are a few larger positions in life sciences that continue to be subject to workouts, with operational improvements being made [29][31] Question: Workout strategies for long-standing non-accruals - The company is focusing on operational workouts and working closely with management teams to drive performance, with no significant changes expected in the near term [31][32]

Financial Data and Key Metrics Changes - Adjusted net investment income for Q4 2025 was $35.4 million or $0.40 per share, up from $32.5 million or $0.37 per share in the prior quarter, reflecting a return to normalized prepayment fees and lower interest expenses [4][18] - NAV per share decreased to $16.64 from $16.76 in the previous quarter due to unrealized depreciation on certain investments [18] - Adjusted total investment income increased to $76.9 million compared to $74.3 million in the third quarter, driven by higher prepayment fees and dividend income [18] Business Line Data and Key Metrics Changes - New-funded investment commitments amounted to $220 million, up 54% from the prior quarter, with first-lien loans representing 88% of new originations [11] - The weighted average yield on debt investments was 9.8%, with a median EBITDA of portfolio companies at approximately $150 million, reflecting a slight decrease from the prior quarter [13] Market Data and Key Metrics Changes - Private credit deal flows showed modest improvement, although the quality of deals was mixed, with a steady supply of high-quality opportunities alongside lower-quality deals [8] - The tightening of private credit spreads was noted, with spreads bottoming out at SOFR plus 450, indicating a cautious optimism in the market [9] Company Strategy and Development Direction - The company aims to prudently increase balance sheet leverage to enhance earnings power and deploy capital into interesting investment opportunities, maintaining a conservative leverage ratio of 0.97 times [6] - Focus on reducing non-accruals and optimizing joint ventures to improve earnings power and support net investment income [6] Management's Comments on Operating Environment and Future Outlook - Management expressed a cautious optimism regarding the long-term outlook on private credit, emphasizing the value of speed and assurance in deal execution for issuers [9] - The company does not expect outsized repayments for the December quarter and anticipates a deployment level consistent with past quarters [24] Other Important Information - The company has ample liquidity of approximately $695 million, including $80 million in cash and $615 million in undrawn capacity on its credit facility [20] - The joint ventures currently hold $513 million of investments, generating ROEs of 12.4% in aggregate during the fourth quarter [20] Q&A Session Summary Question: Expectations around investment activity in the December quarter - Management does not expect any outsized repayments and anticipates deployment levels to be consistent with past December quarters [24] Question: Yield on new investments and pipeline for complex transactions - The yield on new investments was higher due to the complexity of the Walgreens deal, but management does not foresee similar high-spread loans in the upcoming quarter [25][27] Question: Non-accruals in healthcare and pharma segments - Management noted that there are a few larger positions in life sciences that continue to be subject to workouts, with stable to slightly improving conditions [30][32]

Market Overview - US stock futures are extending losses for the fourth consecutive day due to concerns over stock valuations and interest rate uncertainty, with the S&P 500 and NASDAQ closing below their 50-day moving averages, indicating potential further weakness ahead [1][5][10] - Bitcoin has dipped below $90,000 for the first time in seven months, erasing all gains for the year, which has negatively impacted Bitcoin ETFs and related stocks [2][19] Home Depot - Home Depot has cut its full-year profit forecast and missed earnings expectations for the third straight quarter, now expecting full-year sales to rise about 3% and comparable sales to be slightly positive [2][3][20] - The company attributes the decline to slow consumer spending and a weaker housing market, leading to a significant drop in home improvement demand [19][22] - Home Depot's stock is down over 3.5% in pre-market trading as investors assess the timing of a potential turnaround in housing starts and home improvement demand [20][23] Economic Indicators - Private sector job data from ADP shows a loss of 2,500 jobs for the week ending November 1, indicating volatility in the labor market [26] - Initial jobless claims for mid-October were reported at 232,000, slightly up from the previous week, but still considered healthy for the labor market [28][29] Saudi Arabia and US Relations - Saudi Crown Prince Muhammad bin Salman is visiting the White House to strengthen defense and economic ties, with expected announcements including a multibillion-dollar investment in AI infrastructure and defense sales [31][32][33] Trending Stocks - Cloudflare experienced an outage affecting major websites, including OpenAI's ChatGPT and Elon Musk's platform X [37] - Microsoft and Amazon were downgraded to neutral by Redburn, citing unclear bull cases for generative AI [38] - Axon, the paint maker, is acquiring Exalta Coding Systems, creating a $17 billion paint giant [40]

RECENT YEARS GOVERNMENT FUNDING HASN'T ONTO -- GARBAGE LENDING HASN'T GONE TO PUBLIC MARKETS, IT IS GOING TO PRIVATE MARKETS AND PRIVATE BUT IT HAS BEEN POPULAR. IT IS INCREASINGLY OVER ALLOCATED TO BUY LARGE ASSET POOLS. THAT WAS THE DOUBLELINE CAPITAL FOUNDER WEIGHING IN ON THE OUTLOOK FOR PRIVATE CREDIT.WE ARE SEEING CRACK SUBMERGING AND SHINING THE SPOTLIGHT ON AUSTRALIAM WHERE A CREDIT REGULATOR IS -- FAILED TO PROTECT INVESTORS. THE CRACKDOWN ON THE INDUSTRY FILES -- FOLLOWS HIGH-PROFILE COLLAPSES IN ...

Stocks are overpriced. Bonds are overpriced. And private assets are a powder keg. This is the view of Jeffrey Gundlach, the founder and CEO of DoubleLine Capital.@TruthGundlach joins @‌thestalwart and @‌tracyalloway on the Odd Lots podcast to discuss how private credit is showing signs of trouble https://t.co/qoGXjc1GMM ...

Core Insights - The private credit market is facing scrutiny due to concerns over its opaque pricing and lending standards, with warnings from industry veterans about potential risks to financial stability [1][4][6] Market Overview - The U.S. private credit market has grown significantly, from $46 billion in 2000 to approximately $1 trillion in 2023, with projections of reaching about $3 trillion by early 2025 according to Morgan Stanley [3] - Over the past decade, private credit has delivered risk-adjusted returns that have outperformed the broader bond market [3] Industry Concerns - Financial insiders have raised alarms about private credit's opaque lending standards, illiquidity, and excessive leverage, especially in light of recent corporate bankruptcies [4][5] - JPMorgan Chase's CEO, Jamie Dimon, highlighted that private credit's risks could lead to a financial crisis, noting that the current market conditions resemble those preceding the subprime mortgage crisis [5][6] Risk Assessment - Despite concerns, JPMorgan estimates that private credit constitutes less than 10% of corporate debt, suggesting that its impact on the broader economy may be limited [5] - The banking system's direct exposure to private credit is considered small enough to prevent systemic risk from emerging in the event of market distress [5]

Deal Financing - Wall Street banks are considering private credit to finance Novacap's acquisition of Integral Ad [1] - The move to private credit comes after an approach to leveraged loan investors was unsuccessful [1]

AVOID PRIVATE CREDIT CALLING IT THE NEXT SUBPRIME. AND TRADING FOR UNCLE SAM. NICOLE HELD PRIVATE TALKS WITH TREASURY SECRETARY SCOTT BESSENT ABOUT MOVING THE BANK'S HEADQUARTERS TO AMERICA ACCORDING TO THE FINANCIAL TIMES.THE TRUMPET ADMINISTRATION IS SAID TO BE RECEPTIVE AS SWITZERLAND PUSHES AHEAD WITH TOPPER CAPITAL RULES THAT COULD COST UBS $26 BILLION. IT WOULDN'T REALLY COST THEM THAT BUT WE WILL EXPLAIN. A RELOCATION COULD LET THE WORLD'S BIGGEST WEALTH MANAGER TO APPALOOSA REGULATIONS AND DEEPEN IT ...

Core Viewpoint - KKR's co-head of credit and markets, Christopher Sheldon, disagrees with DoubleLine Capital CEO Jeffrey Gundlach regarding the potential crisis in private credit, asserting that the market is currently stable despite economic slowdowns [1] Group 1: Market Condition - Sheldon does not observe signs of "garbage lending" as described by Gundlach, indicating a healthy state of the private credit market [1] - The private credit market is reported to be in good shape even amid a slowing economy, suggesting resilience in this sector [1]