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Data Drop: U.S. private credit provides better risk-adjusted returns across all deal sizes in 2026

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Geopolitical instability, business development company redemptions, concerns over AI disruptions and a sluggish M&A environment continued to weigh on private credit deal flow in the second quarter. Volatility led to wider spreads and slightly lower leverage in the second quarter, providing lenders with better risk-adjusted pricing across all deal sizes. In the lower middle-market segment the average spread per unit of leverage increased 6% quarter over quarter to 145 bps. In the upper middle market, the spread per turn of leverage widened 4% to 112 bps in the second quarter. In the large-cap market it was up by 8% to 98 bps in the second quarter of 2026.

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