Private Credit Crisis: 36 BDCs' Non-Accruals, PIK and Dividends

Which 36 BDCs, and which filing

We read 36 BDCs. Twenty-five are listed (Ares Capital, Blue Owl Capital Corp, Blue Owl Technology Finance, Blackstone Secured Lending, FS KKR, Golub Capital BDC, Main Street, Prospect Capital, Hercules, Morgan Stanley Direct Lending, Sixth Street Specialty Lending, Oaktree Specialty Lending, Goldman Sachs BDC, Barings BDC, MidCap Financial, Bain Capital Specialty Finance, Carlyle Secured Lending, Kayne Anderson BDC, New Mountain Finance, PennantPark Floating Rate, SLR Investment, Nuveen Churchill Direct Lending, Crescent Capital BDC, BlackRock TCP Capital and CION). Eleven are non-traded (BCRED, Apollo Debt Solutions, HPS Corporate Lending, Blue Owl Credit Income, Blue Owl Technology Income, Ares Strategic Income, Oaktree Strategic Credit, Golub Capital Private Credit, Goldman Sachs Private Credit, North Haven Private Income and Barings Private Credit). The listed ones include 22 of the 25 largest by net assets in our BDC stocks list, plus Crescent Capital, CION and BlackRock TCP; the non-traded ones are eleven of the larger funds in our non-traded BDC list.

The filing is the Form 10-Q for the quarter ended June 30, 2026, filed between July 29, 2026 and August 13, 2026, with one exception: Prospect Capital's fiscal year ends in June, so its figures are from its Form 10-K filed August 20, 2026. Five funds have a September fiscal year (Golub Capital BDC, Oaktree Specialty Lending, PennantPark Floating Rate, Oaktree Strategic Credit Fund and Golub Capital Private Credit Fund): their 10-Q for the quarter ended June 30, 2026 covers nine months, and their earlier comparison date is September 30, 2025. Quarters ending September 30, 2026 are not filed yet: the 10-Qs of the calendar-year BDCs are due in November 2026.

Each number below is a line from that filing, quoted in the CSV with its accession. Where we divide one number by another, the page says "(our arithmetic)". Prices, yields and ratings are not here, because none of them is in a 10-Q.

Non-accruals: nine listed BDCs above 3% at cost, no non-traded fund above 2.2%

A loan is on non-accrual when the BDC has stopped booking its interest because payment is in doubt. The wording differs. Blue Owl Capital Corp says loans are placed on non-accrual “when there is reasonable doubt that principal or interest will be collected in full”. Hercules says debt investments are placed on non-accrual “when it is probable that principal, interest or fees will not be collected according to contractual terms”. And Morgan Stanley Direct Lending adds a way out: “We may determine to not place an investment on non-accrual status if the investment has sufficient collateral value and is in the process of collection”.

The table is sorted by the share of the portfolio on non-accrual at cost, the measure that shows how much of what the fund lent has stopped paying. "n/s" means the 10-Q does not state it.

Three readings of the table (our arithmetic where we count):

• Listed against non-traded. The 11 non-traded funds report a median 0.6% of their portfolio on non-accrual at cost, against 2.9% at the 19 listed BDCs that state it (our arithmetic). At fair value the medians are 1.56% (20 listed that state it) and 0.25% (10 non-traded). Why the gap exists is not in the 10-Qs; we do not claim a reason.
• The jump at Blackstone's two funds. Blackstone Secured Lending (BXSL) had “six issuers (across eight loans)” on non-accrual at June 30, 2026 against five at December 31, 2025, and its share at cost went from 0.6% to 3.6%. BCRED had “fifteen issuers (across twenty-five loans)” against nine, and went from 0.6% to 2.2%. Both numbers are in each fund's 10-Q table of portfolio characteristics.
• Who improved. BlackRock TCP Capital (9.7% to 7.4%), Oaktree Specialty Lending (6.5% at September 30, 2025 to 4.2%), North Haven Private Income Fund (1.8% to 1.4%) and Blue Owl Credit Income (0.6% to 0.3%) are lower than at their comparison date. A fall in the percentage can mean a recovery, a sale or a write-off of the loan; the 10-Q percentages do not tell which.

Cost against fair value: what a markdown hides

BlackRock TCP Capital's 10-Q says: “representing 1.6% of the portfolio at fair value and 7.4% at cost.” Same loans, two numbers: the 1.6% is what the fund now thinks they are worth, the 7.4% is what it lent. The more a fund has already written the loans down, the larger the gap between the two columns. Main Street Capital shows the same pattern (4.0% at cost, 1.1% at fair value), as does OCSL (4.2% and 1.8%) and BXSL (3.6% and 1.8%).

Two cautions. First, fair value is the fund's own estimate, set quarter by quarter; a loan on non-accrual at 1.6% of the portfolio today can be marked lower next quarter without changing the percentage of loans that have stopped paying. Second, some funds print only one side: FS KKR (3.8% at fair value, and 3.3% for its direct originations alone, per its 10-Q), Nuveen Churchill (1.52%), CION (1.4%) and Prospect Capital (0.7% of total assets at fair value) give no percentage at cost, while Hercules (0.3%), Morgan Stanley Direct Lending (2.9%) and North Haven Private Income Fund (1.4%) give no percentage at fair value. Prospect Capital states the cost basis of loans on non-accrual as $298.2 million and their fair value as $42.5 million. New Mountain Finance and SLR Investment give neither a percentage (SLR gives a count: two issuers).

Barings BDC's 10-Q adds a nuance that a single number would hide: it had 11 portfolio companies on non-accrual, 1.5% of cost and 0.6% of fair value, and “the non-accruals as of June 30, 2026 comprised 0.2% of the total fair value of our portfolio and 0.9% of the aggregate cost of our portfolio.” The difference is the non-accrual assets covered by a credit support agreement with its manager; the 10-Q gives both figures.

PIK income: how much of the income is not cash

PIK (payment in kind) interest is interest the borrower pays by adding it to the loan balance instead of paying cash. It is booked as income, and a BDC distributes its income to shareholders, but the cash for that part has not come in. A rising PIK share can be a sign that borrowers are short of cash; the point here is how much of each fund's income it is, in the same 10-Q.

The second table has that share as the 10-Q's own lines add up: the cash-flow statement line for PIK interest (and PIK dividends where the fund shows them), divided by total investment income for the same period (our arithmetic). The highest are CION 24.7%, Ares Capital 15.5%, Bain Capital Specialty Finance 15.1%, FS KKR 13.5% and Blue Owl Technology Finance 12.5%; the lowest are Oaktree Strategic Credit Fund 1.8%, PennantPark Floating Rate 2.2%, Main Street 2.8% and Apollo Debt Solutions 3.0%.

The basis is not the same everywhere, and it matters. Blue Owl Technology Finance's cash-flow line (PIK interest and dividends, $83.0 million) is 12.5% of its $664.0 million of investment income; its MD&A says PIK interest alone was “as a percentage of total income it decreased to 7.5% for the six months ended June 30, 2026 from 8.0% for the six months ended June 30, 2025”. In 15 of the 36 the line is interest only. So the column is "PIK as labeled", not a uniform measure; the order of magnitude and the outliers are what to read. CION, at 24.7%, uses a line that also includes dividends capitalized.

Dividend coverage and NAV: who pays out more than it earns

Coverage is the net investment income per share earned in the period divided by the distributions per share declared (or paid, as the fund's table labels them) in the same period (our arithmetic). Below 100%, the difference is paid from earlier earnings, from gains or from capital. NAV per share is the balance-sheet figure at June 30, 2026 against June 30, 2025 in the prior year's 10-Q. Net investment income and distributions are for six months (nine at the fiscal-year-September funds, one year at Prospect Capital); for the non-traded funds the per-share figures are Class I where the 10-Q shows classes (Goldman Sachs Private Credit Corp. is in total dollars; North Haven is per unit). NAV per share for Blue Owl Credit Income and Blue Owl Technology Income is the Class S figure as their balance sheets print it.

At the non-traded funds, distributions track net investment income closely (89% to 104% in the table). BCRED earned $1.07 per Class I share in six months and distributed $1.20 (89%), and Apollo Debt Solutions earned $0.99 and distributed $1.08 including $0.09 in excess of net investment income. At the listed BDCs the gap shows up differently: Main Street earned $1.90 and paid $2.16 (it pays supplemental dividends), and Blue Owl Technology Finance earned $0.67 and declared $0.80. At BlackRock TCP Capital and MidCap Financial the ratio is above 120% because their distributions fell sharply from a year earlier ($0.34 against $0.58 at TCP, $0.62 against $0.76 at MidCap in the same table lines).

NAV per share fell at 34 of the 36. The two exceptions are Main Street (+5.0%) and Hercules (+2.6%). A BDC can show 100% coverage and still lose NAV, because losses on loans go through NAV, not through NII. BlackRock TCP Capital's NAV fell from $8.71 to $6.58, FS KKR's from $21.93 to $18.30.

The non-traded funds' exit door, in the same 10-Qs

The non-traded funds' 10-Qs also say what they bought back in the quarter that ended June 30, 2026. Requests, which decide whether holders are prorated, are stated by only a few; the full series from each fund's Schedule TO is in our redemptions tracker and private credit funds comparison.

HPS Corporate Lending's 10-Q is the one that puts both numbers side by side: it offered to repurchase 5.00% of its shares and received requests for 13.30% (9.25% in March). North Haven Private Income Fund and Barings Private Credit say they accepted about 41.6% and 46.01% of the shares tendered. Goldman Sachs Private Credit Corp.'s 10-Q footnote reads “All repurchase requests were satisfied in full.” The census does not show a link between a fund's non-accrual level and the size of its requests: the 10-Q does not give enough information to test one.

What these numbers do not show

• There is no standard definition of non-accrual. Blue Owl says “reasonable doubt”; Hercules says “probable” that payment will not be collected. A BDC may also decide not to put a loan on non-accrual at all: “We may determine to not place an investment on non-accrual status if the investment has sufficient collateral value and is in the process of collection” (Morgan Stanley Direct Lending). Two funds with the same loan can legitimately show different percentages.
• The denominators differ. Prospect Capital measures against total assets, HPS Corporate Lending against debt and income-producing investments excluding its joint ventures (1.27% at cost, 0.70% at fair value), Oaktree Specialty Lending, Oaktree Strategic Credit and Kayne Anderson against debt investments, others against all investments.
• A non-accrual is not a default and a default is not a loss. The percentages show the stock of problem loans on June 30, 2026; they do not say what will be recovered.
• A loan that pays in kind is still accruing. A borrower that moved to PIK instead of missing payments does not appear in the non-accrual column. That is why the PIK table sits next to it, and why neither column alone settles the question.
• The date is June 30, 2026. Everything that happened in the third quarter is missing: the next 10-Qs will cover September 30, 2026. The calendar-year BDCs file them in November 2026; the fiscal-year-September funds file their 10-K later.
• Fair-value marks are estimates. A fall in NAV per share is the fund's valuation, quarter by quarter; the 10-Q does not tell you what you could sell your shares for (traded BDCs trade at a price that can be far from NAV, and non-traded funds buy back at NAV only up to their quarterly limit).
• NII per share is the GAAP figure in each 10-Q. Adjusted NII that excludes some costs, which several BDCs publish in their earnings releases, is not here, nor are one-off special dividends we could not separate. Main Street's "dividends" include supplemental ones.
• Other sources can differ without being wrong. Our private credit funds page counts PIK from the income-statement line (BCRED 5.4%, North Haven 2.7%); this page counts the cash-flow line, which covers all of the fund's investments, not only the first income-statement line (BCRED 5.7%, North Haven 5.3%). Both are in the 10-Q.

For the size of the market and the Federal Reserve's own definition, see what private credit is; for the 50 listed BDCs by net assets and leverage, the BDC stocks list.

What a holder can do with this

• Look up your fund in the first table, then in its own 10-Q. The non-accrual percentage at cost, the PIK line in the cash-flow statement and the “Financial Highlights” table (net investment income and distributions per share) are the three places this page used.
• Compare a fund with itself over time before you compare it with another. The earlier date is in the same table: BXSL and BCRED went up, BlackRock TCP and Oaktree Specialty Lending came down. The level matters less than the direction and the reason, which the fund's discussion of its non-accrual investments gives.
• If you hold a non-traded fund, read its repurchase table with its non-accrual table. The census shows low non-accruals at most non-traded funds and prorated offers at the same funds in the redemptions tracker: for those holders the practical limit in 2026 has been the 5% quarterly offer, which the tracker documents; the credit numbers on this page are a separate question.
• If you hold a listed BDC, the number to watch next is coverage. At 22 of the 36 the earnings did not cover the payout in the latest period; TCP and MidCap are over 120% after lowering their payouts.
• What would change the picture: non-accruals at the non-traded funds moving toward the 3% to 7% of the listed ones, or PIK share rising across the board in the third-quarter 10-Qs.

This is analysis of public documents, not investment, legal or tax advice.

FAQ

All figures are from the SEC filings of the 36 BDCs named in the tables, read on EDGAR on October 14, 2026: the Form 10-Q for the quarter ended June 30, 2026 of each fund (Prospect Capital: Form 10-K for the fiscal year ended June 30, 2026), and the Form 10-Q (10-K) of the same fund for June 30, 2025 for NAV per share a year earlier. Accession numbers are in the tables and in the CSV. Medians, counts, shares of income and coverage ratios are our arithmetic from those lines. The PIK column, the denominators and the periods vary by fund, as the page says.