Carlyle’s private credit business has reported a modest decline in the value of its listed lending vehicle, reflecting ongoing pressure from higher interest rates and widening credit spreads across its borrower base, according to a report by Reuters.
Carlyle Secured Lending recorded a 2.3% fall in net asset value per share to $15.89 at the end of March, compared with the previous quarter. The firm attributed the decrease primarily to unrealised losses driven by wider borrowing spreads, alongside weaker valuations in parts of its software-related portfolio.
Executives also pointed to pressure in technology-linked holdings, noting that roughly 10% of the portfolio is exposed to software borrowers—an area increasingly under scrutiny as artificial intelligence disruption raises concerns about long-term business model resilience.
Investor sentiment in private credit vehicles has also shown signs of strain. Carlyle’s Tactical Private Credit Fund experienced elevated redemption requests in the first quarter, with investor withdrawal demand reaching 15.7% of shares—significantly above the fund’s 5% repurchase limit.
Despite valuation pressure, credit performance indicators showed some stabilisation. The fund’s non-accrual rate improved to 0.9% of fair value, down from 1.2% in the previous quarter, supported by at least one successful debt restructuring during the period.
Investment activity remained broadly balanced, with loan originations of $217.5m closely matching combined repayments and sales of $216m.
However, income distribution was adjusted, with Carlyle declaring a second-quarter dividend of 35 cents per share, down from 40 cents previously, reflecting more conservative earnings expectations.
