Accessible Version
Private Credit and Leveraged Loan Markets: Similarities, Differences, and Substitution, Accessible Data
Figure 1. Nonfinancial Debt Outstanding of Privately Held Corporations
This is a stacked line chart showing three components of total debt outstanding of nonfinancial privately held corporations (i.e., corporations that are not publicly traded): private credit debt, leveraged loan debt, and other debt. The chart shows quarterly data from Q1 2010 to Q1 2026. The y-axis measuring trillions of dollars ranges from zero to 7. The dark blue shaded area at the top of the chart represents the private credit share of debt, which has grown from a very small share of private corporation debt in Q1 2010, with around $0.23 trillion debt outstanding, to about $1.4 trillion in debt outstanding in Q1 2026. The light blue shaded area in the middle of the chart represents the leveraged loans share of private corporation debt, which was about 0.35 trillion outstanding in Q1 2010 and has grown to about $1 trillion. The pink/red shaded area at the bottom of the chart represents other debt of private corporations, which has grown from about $2.6 trillion outstanding in Q1 2010 to about $3.2 trillion in Q1 2026.
Note: Other debt includes categories such as bank loans, mortgages, finance company loans, and foreign loans. It does not include operating leases. Private credit includes private debt fund data through 2025 Q3, interval fund data through 2025 Q4, and BDC and middle-market CLO data through 2026 Q1. The figure excludes leveraged loans to public firms. The key identifies bars in order from top to bottom.
Source: Financial Accounts of the United States; Compustat North America; PitchBook Data, Inc.; S&P; BDC Collateral; Moody’s Analytics, Inc.; Preqin, Ltd.; N-PORT; staff estimates.
Figure 2. Lender Shares in PC Market
This is a pie chart showing the distribution of lender shares in private credit (PC) as of Q3 2025. The chart displays six categories of lenders with their respective percentage shares. Private debt funds make up 54.7 percent (dark blue segment), perpetual-life business development companies (BDCs) make up 18.7 percent (yellow segment), public BDCs make up 12.4 percent (pink/red segment), middle-market collateralized loan obligations (CLOs) make up 5.9 percent (purple segment), interval funds make up 3.0 percent (light blue segment), and private BDCs make up 5.4 percent (green segment).
Note: Data as of Q3 2025. Percentages reflect unrealized value for private debt funds, loan assets for interval funds and assets under management for other lenders.
Source: Preqin, Ltd.; Moody’s Analytics, Inc.; BDC Collateral; N-PORT.
Figure 3. Lender Shares in LL Market
This is a pie chart showing the distribution of lender shares in leveraged loans (LL) as of Q1 2026. The chart displays three categories of lenders with their respective percentage shares. BSL CLO represents the largest share at 67.2 percent (teal/green segment), followed by "Other" investors at 22.2 percent (light blue segment), and Loan mutual funds & ETFs at 10.6 percent (pink segment). The three segments together account for 100 percent of the lender shares in leveraged loans.
Note: Data as of Q1 2026. “Other” investors include, but are not limited to, finance/insurance companies, banks, hedge funds, and pensions.
Source: LSEG Data & Analytics; Bank of America Merrill Lynch Global Fund Manager Survey.
Figure 4. Share of Firms with New Borrowing in the PC Market, by Firm Size
This is a line chart showing quarterly data from 2006 through Q1 2026, with the y-axis measuring percent ranging from 0 to 100. The chart displays two variables: "Large Firms" represented by a dashed brown line and "Small Firms" represented by a solid blue line. The small firms line consistently maintains higher values, generally fluctuating between 60 and 90 percent throughout the period. The large firms line shows lower values, starting at around 20 percent in 2006 and gradually increasing to approximately 30-40 percent by 2018, then rising more sharply to peaks of about 50-60 percent around 2022-2023, before declining toward the end of the period. The chart includes several gray vertical shaded bands throughout the timeline that highlight periods when financing conditions are tight in the LL market, as suggested by an excess loan premium. As of Q1 2026, the small firms share is approximately 70 percent, while the large firms share is about 30 percent.
Note: Lines show the four-quarter rolling share of firms with new borrowing in PC among firms with new borrowing in either the PC or LL market, separately for large and small firms. Shaded areas indicate periods when financing conditions are tight in the LL market, as suggested by an excess loan premium—a measure of the risk premium demanded by leveraged loan investors—that is above its historical median: June 2007-December 2010, June 2011-July 2012, November 2015-April 2016, June 2019-November 2020, May 2022-September 2024.
Source: Pitchbook Data, Inc.
Figure 5. Distribution of Borrowers by their Debt Profile, as of the End of 2025
This is a pie chart showing the distribution of borrowers by their debt profile as of the end of 2025. The chart displays three categories with their respective percentage shares. The largest segment represents borrowers in "PC only" markets at 38.9 percent (pink/red segment), followed by borrowers in "Both markets" at 32.1 percent (blue segment), and borrowers in "LL only" markets at 29.0 percent (yellow segment). The three segments together account for 100 percent of the borrowers.
Note: A firm is classified as “PC only” or “LL only” at a date if the firm has exclusively borrowed from the private credit or the leveraged loan market up to that date, respectively. Once the firm switches from one market to the other, it is classified as “Both markets.” Only includes borrowers who have issued debt from the beginning of 2020 to the end of 2025.
Source: PitchBook Data, Inc.
Figure 6. Borrower Distribution by Debt Profile, Large Firms
This is a pie chart showing the distribution of large firm borrowers by their debt profile. The chart displays three categories with their respective percentage shares. The largest segment represents borrowers in "LL only" markets at 43.2 percent (yellow segment), followed closely by borrowers in "Both markets" at 40.9 percent (blue segment), and borrowers in "PC only" markets at 15.9 percent (pink/red segment). The three segments together account for 100 percent of the large firm borrowers.
Note: A firm is classified as “PC only” or “LL only” at a date if the firm has exclusively borrowed from the private credit or the leveraged loan market up to that date, respectively. Once the firm switches from one market to the other, it is classified as “Both markets”. Only includes borrowers who have issued debt from the beginning of 2020 to the end of 2025.
Source: PitchBook Data, Inc.
Figure 7. Borrower Distribution by Debt Profile, Small Firms
This is a pie chart showing the distribution of small firm borrowers by their debt profile. The chart displays three categories with their respective percentage shares. The largest segment represents borrowers in "PC only" markets at 56.9 percent (pink/red segment), followed by borrowers in "Both markets" at 25.3 percent (blue segment), and borrowers in "LL only" markets at 17.9 percent (yellow segment). The three segments together account for 100 percent of the small firm borrowers.
Note: A firm is classified as “PC only” or “LL only” at a date if the firm has exclusively borrowed from the private credit or the leveraged loan market up to that date, respectively. Once the firm switches from one market to the other, it is classified as “Both markets”. Only includes borrowers who have issued debt from the beginning of 2020 to the end of 2025.
Source: PitchBook Data, Inc.
Figure 8. Share of Firms Switching between PC and LL Markets
This is a line chart showing quarterly data from 2012 through Q1 2026, with the y-axis measuring percent ranging from 0 to 80. The chart displays two variables: "LL to PC" represented by a solid blue line and "PC to LL" represented by a dashed brown line. Both lines show considerable fluctuation throughout the period. The blue line (LL to PC) generally ranges between 20 and 50 percent with notable peaks occurring around 2012, 2015, 2019-2020, and particularly high values of approximately 50 percent in 2023. The brown line (PC to LL) typically fluctuates between 20 and 45 percent with peaks around 2013-2014 and 2017. Several vertical gray shaded bands appear throughout the chart period indicating periods when financing conditions are tight in the LL market, as suggested by an excess loan premium. As of Q1 2026, the LL to PC switching share is approximately 21 percent, while the PC to LL switching share is about 25 percent.
Note: At each quarter, the sample includes firms with a new loan in the trailing 12 months. The blue line shows the share of firms whose prior loans were in the LL market and current loans are in the PC market; the brown line is defined analogously for PC-to-LL switchers. Shaded areas indicate periods when financing conditions are tight in the LL market, as suggested by an excess loan premium that is above its historical median: June 2011-July 2012, November 2015-April 2016, June 2019-November 2020, May 2022-September 2024.
Source: PitchBook Data, Inc.
Figure 9. Share of Firms Switching between PC and LL Markets, Large Firms
This is a line chart showing quarterly data from 2012 through Q1 2026, with the y-axis measuring percent ranging from 0 to 80. The chart displays two variables: "LL to PC" large firms represented by a solid blue line and "PC to LL" large firms represented by a dashed brown line. Both lines show fluctuation throughout the period. The brown line (PC to LL) generally has higher values in the earlier part of the period (2012-2018), ranging between 40 and 60 percent, before decreasing to around 20-40 percent in later years. The blue line (LL to PC) typically fluctuates between 20 and 40 percent throughout most of the period, with a slight increase around 2022-2023. Several vertical gray shaded bands appear throughout the chart period, indicating periods when financing conditions are tight in the LL market, as suggested by an excess loan premium that is above its historical mean. As of Q1 2026, the LL to PC switching share is approximately 14 percent, while the PC to LL switching share is about 40 percent.
Note: At each quarter, the sample includes firms with a new loan in the trailing 12 months. The blue line shows the share of firms whose prior loan was in the LL market and current loan is in the PC market; the brown line is defined analogously for PC-to-LL switchers. Shaded areas indicate periods when financing conditions are tight in the LL market, as suggested by an excess loan premium that is above its historical median: June 2011-July 2012, November 2015-April 2016, June 2019-November 2020, May 2022-September 2024.
Source: PitchBook Data, Inc.
Figure 10. Share of Firms Switching between PC and LL Markets, Small Firms
This is a line chart showing quarterly data from 2012 through Q1 2026, with the y-axis measuring percent ranging from 0 to 80. The chart displays two variables: "LL to PC" represented by a blue line and "PC to LL" represented by a dashed brown line. The blue line (LL to PC) shows considerably higher values than the brown line throughout most of the period. The blue line fluctuates between approximately 30 and 70 percent, with notable peaks in 2020 and 2022-2024 reaching about 70 percent. In contrast, the brown line (PC to LL) remains relatively stable at lower levels, generally ranging between 10 and 20 percent throughout the entire period. Several vertical gray shaded bands appear throughout the chart period, indicating periods when financing conditions are tight in the LL market, as suggested by an excess loan premium that is above its historical mean. As of Q1 2026, the LL to PC switching share is approximately 45 percent, while the PC to LL switching share remains steady at about 20 percent.
Note: At each quarter, the sample includes firms with a new loan in the trailing 12 months. The blue line shows the share of firms whose prior loan was in the LL market and current loan is in the PC market; the brown line is defined analogously for PC-to-LL switchers. Shaded areas indicate periods when financing conditions are tight in the LL market, as suggested by an excess loan premium that is above its historical median: June 2011-July 2012, November 2015-April 2016, June 2019-November 2020, May 2022-September 2024.
Source: PitchBook Data, Inc.
Figure 11. Borrower Distribution by Debt Profile, Software Firms
This is a pie chart showing the distribution of software firm borrowers by their debt profile. The chart displays three categories with their respective percentage shares. The largest segment represents borrowers in "PC only" markets at 46.3 percent (pink/red segment), followed by borrowers in "Both markets" at 30.6 percent (blue segment), and borrowers in "LL only" markets at 23.1 percent (yellow segment). The three segments together account for 100 percent of the software firm borrowers.
Note: A firm is classified as “PC only” or “LL only” at a date if the firm has exclusively borrowed from the private credit or the leveraged loan market up to that date, respectively. Once the firm switches from one market to the other, it is classified as “Both markets.” Only includes borrowers who have issued debt from the beginning of 2020 to the end of 2025.
Source: PitchBook Data, Inc.
Figure 12. Share of Firms Switching between PC and LL Markets, Software Firms
This is a line chart showing quarterly data from approximately 2012 through Q1 2026, with the y-axis measuring percent ranging from 0 to 80. The chart displays two variables: "LL to PC Software" represented by a blue solid line and "PC to LL Software" represented by a dashed brown line. Both lines show considerable fluctuation throughout the period. The blue line (LL to PC) generally ranges between 15 and 55 percent, with notable peaks occurring around 2015, 2020, 2022-2023, and 2025. The dashed brown line (PC to LL) typically fluctuates between 15 and 55 percent, with peaks around 2014, 2017 and 2021 Several vertical gray shaded bands appear throughout the chart period indicating periods when financing conditions are tight in the LL market, as suggested by an excess loan premium that is above its historical mean. As of Q1 2026, the LL to PC switching share is approximately 30 percent, while the PC to LL switching share is about 20 percent.
Note: At each quarter, the sample includes firms with a new loan in the trailing 12 months. The blue line shows the share of firms whose prior loan was in the LL market and current loan is in the PC market; the brown line is defined analogously for PC-to-LL switchers. Shaded areas indicate periods when financing conditions are tight in the LL market, as suggested by an excess loan premium that is above its historical median: June 2011-July 2012, November 2015-April 2016, June 2019-November 2020, May 2022-September 2024.
Source: PitchBook Data, Inc.