Business development companies (BDCs) are the public and non-traded funds that lend to mid-sized private companies. Every quarter each one files a schedule of investments with the SEC: every loan, the borrower, the lien, the spread, the cost and the fair value the lender puts on it. Since August 2022 those schedules are tagged in inline XBRL, so Palanor reads them as data.
Where you see it
- Signals. Quarterly series in the Library under Credit: loan marks (fair value as a share of cost), loans marked below 80% of cost, non-accruals at cost and at fair value, the cost-weighted spread over the base rate, the second-lien and junior share, the share paying interest in kind (PIK), the share of debt in borrowers that two or more lenders share, and lending to new borrowers. Marks and non-accruals also come by industry where there is enough debt to read.
- The screener. A Private credit loans tab lists every holding in each BDC's latest schedule. The totals by industry, lien, holding type and manager are free. Loan-level rows are part of Palanor Pro.
- Entity pages. When a borrower matches a company in Palanor's company graph, its page shows which BDCs lend to it, from which managers, and how its marks have moved by quarter.
- Credit commentary. The credit-quality paragraphs of each BDC's MD&A are scored for stress words per 1,000 words, a fixed word list with no model. A tone score from a language model is built but not yet published.
How it is made
- The source. The SEC's Business Development Company data sets, one file a month with every BDC 10-K and 10-Q as filed. Palanor turns the tagged facts into one row per holding.
- Non-accrual status. BDCs mark a loan on non-accrual with a footnote on its schedule row. Palanor reads those footnotes from each filing's own XBRL. A footnote dated to an earlier balance-sheet date does not count. The non-accrual series use the BDCs whose footnotes speak to accrual status, and divide by all of their investments at cost or fair value, the way BDCs report it.
- Checks. Some filers also tag subtotals on the same rows. Palanor removes them in steps and keeps a filing only when its rows add up to between 85% and 120% of the total it reports. A quarter publishes once at least 60 BDCs pass, and 80 days after the quarter ends, when the 10-Qs are in.
- Borrowers. The borrower is read from the lender's own row label. Two lenders often spell one borrower differently, so names are compared with legal forms and deal-vehicle words ("Buyer", "Bidco", "Holdings") removed. A borrower is linked to the company graph only on an exact, distinctive and unique name match.
- Lenders and managers. Affiliated BDCs lend side by side, so sharing is counted across managers, not funds.
Reading it
- Marks are the lender's own fair values, set each quarter by its valuation process. They move with credit and with market spreads.
- Lending to new borrowers counts borrowers a BDC did not hold the quarter before, among BDCs in the panel both quarters. It is a proxy for new deals, not a count of new loans: add-ons to existing borrowers are not in it.
- Industry is the lender's own label where it gives one, else the industry other lenders give the same borrower. Some loans have none.
- The series start in 2023, when enough BDCs had started tagging. Palanor Foresight draws on them in the Library like any quarterly series, from their own history only: lead partners need ten years of history, and Foresight's scored record logs a series once it has 20 readings.
Source
U.S. Securities and Exchange Commission, BDC data sets and EDGAR filings. SEC information may be copied and distributed without the SEC's permission; Palanor cites the SEC as the source.