The international private debt market continues to show stable and a cautiously positive development in the second half of 2026. This is evident from the BF.Private Debt Market Sentiment Index, which reached a value of 59.7 points. This figure is above the neutral mark of 50 points and confirms the level of the first half of the year, when 60.1 points were recorded. The so-called Expectation Gap indicates a cautiously positive outlook for the upcoming period.
The analysis reveals a continuous improvement in financing conditions from the lenders' perspective. This development contrasts with the slightly borrower-friendly trends observed in the first half of the year. The General Partners surveyed anticipate that this trend will continue over the next six months. Concurrently, leverage levels in the Corporate Direct Lending, Real Estate Debt, and Infrastructure Debt segments largely remain in a moderate range, which generates an attractive risk-return profile for investors.
Robust Fundraising and Stable Credit Quality
Fundraising remains a significant pillar of positive market sentiment, even though the momentum has slightly softened compared to the initial survey. The overall environment is nevertheless assessed as constructive. A growing proportion of respondents report stable fundraising conditions, while significant deteriorations are the exception. Capital commitments from institutional investors also prove resilient, albeit at a slightly lower level than before. For instance, 59 percent of respondents recorded increasing commitments from Limited Partners in the past half-year, down from 64 percent in the first half. For the coming six months, 62 percent of participants expect further increasing capital commitments. In particular, the top-up of existing investments acts as a stability anchor.
- —In Corporate Direct Lending, approximately 87 percent of participants report re-up rates exceeding 40 percent.
- —In Real Estate Debt, this figure stands at 80 percent.
- —In the Infrastructure sector, it is 78 percent.
The credit quality of portfolios proves largely stable despite ongoing macroeconomic and geopolitical uncertainties. For 75 percent of respondents, compared to 85 percent in the first half-year, the rates for non-performing or defaulted loans remained unchanged over the past six months. Significant deteriorations are only mentioned in isolated cases. For the coming half-year period, a clear majority expects stable default rates, although the proportion of respondents anticipating a significant increase has risen from 1.6 to 6.6 percent. Stress factors in portfolios continue to manifest primarily in specific sectors and usage types, rather than due to structural financing problems.
Transaction Activity and Growth Impulses
The special topic of the current issue highlighted the development of transaction objectives in the private debt market. Eugenio Sangermano, Managing Director of BF.capital, noted that acquisition financing continues to play a central role across all segments. Financing solutions supporting growth, expansion, and strategic capital allocation are also gaining importance. Restructuring or distressed situations, however, remained the exception. Professor Dr. Michael Flad from Esslingen University of Applied Sciences, who serves as a scientific advisor to the BF.Private Debt Market Compass, added that demand for private debt financing continues to be driven primarily by organic growth and investment activities, and not by increasing financial stress on the borrower side.
