BCRED's First-Half Markdown Triples 2025's Unrealized Loss

The first half of 2026 forced Blackstone Private Credit Fund to confront the gap between total return and the fair value of the book beneath it. BCRED, a nontraded business development company, booked $1.85 billion in net unrealized depreciation for the six months through June 30. That is more than triple the $522.9 million unrealized loss the fund absorbed in all of 2025, according to its own reporting.

The second quarter took the brunt: $811 million of the depreciation landed in those three months, against a $78.9 million unrealized gain in the same quarter a year earlier — a swing of roughly $890 million. The fund attributed the marks to declining fair value on its debt investments, which fell 1.8% as a percentage of principal over the six months, citing “changes in certain portfolio company fundamentals and broader economic conditions.”

Net asset value per share ended the half at $23.65, down from $24.79 at year-end 2025. That makes four consecutive quarterly declines, AltsWire reported when BCRED posted a 0.3% total return for Class I shares in the second quarter. The positive return came from reinvested distributions, which largely offset the NAV drop for shareholders even as the underlying portfolio marked down.

Redemption activity accelerated sharply. BCRED repurchased approximately $5.44 billion in shares across its three classes in the first half, more than three times the roughly $1.68 billion repurchased in the same period a year earlier. The pace is consistent with the elevated redemption requests many nontraded BDCs have reported throughout the year, including BCRED’s then-record 7.9% of shares requested in the first quarter and 10% in the second. The fund satisfied both through proration and additional capital.

The portfolio thinned on nearly every measure. Total investments at fair value came to $77.6 billion across 653 portfolio companies, down from $82.2 billion across 700 companies at year-end. Asset coverage declined to 221.3% from 235.7%, still well above the 150% threshold required under the Investment Company Act of 1940. Average loan-to-value ticked up to 47.1% from 45.9%, while the weighted average yield on performing debt investments, at amortized cost, slipped to 9% from 9.2%.

The executive row thinned. Co-chief executive officer Jonathan Bock resigned effective July 20, following chief operating officer Katherine Rubenstein’s departure on June 15, as AltsWire previously reported. Brad Marshall now serves as the fund’s sole chief executive. The coverage gives no reason for either exit.

None of this adds up to a run. The nontraded structure caps and prorates redemptions, and BCRED met the requests through proration and additional capital. Proration, though, only delays the outflow. The requests show a growing slice of shareholders wants to leave.

Whether Bock’s departure shifts strategy is unknown. The next quarterly report will arrive without him, and with fair values trending down, the redemption queue is unlikely to ease on its own.