Octus BDC Weekly Roundup: 31 Borrowers Added to Nonaccrual; BDCs Report Muted New Investment Activity but Point to Widening Spreads; Funds Initiate Share Repurchase Plans

Relevant Items:
Octus’ BDC Database
Private Credit Dashboard

Editor’s Note: A weekly roundup of business development company, or BDC, articles available to Private Credit and Deal Origination subscribers is below. To get access to any of the below, please reach out to [email protected]. Octus’ BDC Analyst team has published a series of articles covering BDC quarterly earnings, sector-level stressed watchlists and proprietary analysis built on top of the BDC data that Octus extracts from more than 170 private and public BDCs. Octus’ full Private Credit product suite includes deal origination and private credit coverage, BDC and Private Credit Data, Private Credit Fundamentals, Deal Term Analytics and Covenants analysis. Contact [email protected] or your account manager for a demo.

For year-to-date and prior-week coverage highlights, please see our roundups HERE, HERE, HERE, HERE, HERE and HERE.

BDC Webinar: Managing Liquidity, Maintaining Stability: Watch the replay of Octus’ webinar from May 5, featuring Blair Faulstich, senior managing director and head of U.S. direct lending at Benefit Street Partners, and Matthew Freund, president of Barings BDC and head of North America private credit portfolio management. Our panel discussed the complex forces reshaping the private credit and BDC landscape.

Many of the publicly listed BDCs reported earnings last week, including Blackstone Secured Lending, BlackRock TCP, Blue Owl Capital Corp., Goldman Sachs BDC, Golub Capital BDC, Midcap Financial, New Mountain Finance Corp., Oaktree Specialty Lending, PennantPark Investment Corp. and Sixth Street Specialty Lending.

A number of themes developing from first-quarter reports so far include:

• Share repurchases: A number of companies announced share repurchase plans or continue prior authorizations: Midcap Financial fully utilized a $107.9 million authorization; Blue Owl Capital bought back $35 million; Horizon Technology Finance is planning a $10 million program; Blackstone Secured Lending guided to share repurchases from expected portfolio repayments; Golub prioritized accretive share repurchases.
• Tepid lending activity, wider spreads: BDCs guided to generally muted volume but widening spreads. A number of BDCs reported spreads widening approximately 50 bps above 2025 tights.
• Investment and cash income falls: Most BDCs reported lower year-over-year investment income, driven by lower base rates, spread compression and smaller asset bases. Following the last reported quarter, a number of BDCs lowered dividends.

Medallia: Blackstone Secured Lending Fund placed Medallia on nonaccrual status in the first quarter of 2026, marking the investment at 60.3% of par. BXSL management stressed that the business is “highly profitable today” but noted that the elevated debt levels “prevented them from fully investing into the company for growth.” As a result, according to management, “As part of this restructuring, we, together with the other lenders, plan to invest new capital into the business and meaningfully de-lever the balance sheet.”

Octus tracks BDC changes to nonaccrual status. Thirty-one borrowers were placed on nonaccrual status as of March 31, based on BDCs that reported between May 4 through May 7. This is in addition to the five identified last week. Results as of March 31 are below:

Octus has been tracking redemption requests by shareholders of nontraded BDCs. Although many funds have limited quarterly tenders to 5% of total shares outstanding, certain redemption requests have far exceeded the 5% maximum. Results by BDC for a sample of the largest funds are shown below, along with results dating back to the first quarter of 2025.