KBRA publishes the issuer and senior unsecured debt ratings of BBB for Bain Capital Private Credit ("BCPC" or "the company"). On November 5, 2024, these ratings were assigned on an unpublished basis. The rating Outlook is Stable.

Key Credit Considerations

The ratings and Stable Outlook are supported by BCPC’s ties to the $54 billion Bain Capital Credit ("BCC") credit platform, including $16 billion dedicated to private credit, along with SEC exemptive relief to co-invest in other funds managed by its advisor, BCPC Advisors, LP ("Adviser"), and its affiliates. BCC's solid management team has a long track record working within the private credit markets dating back to the mid-1990s, with BCC’s platform providing a 28-year history of strong credit performance through economic cycles. Also supporting the ratings is BCPC’s well-diversified $899.3 million investment portfolio comprised largely of senior secured first lien loans (90.5%) to 126 portfolio companies across 25 sectors, exclusive of investments in JVs, most in the core middle market with median EBITDA of $48 million as of March 31, 2025. The top three portfolio sectors are Business Services (16.0%), Healthcare & Pharmaceuticals (14.5%), and High Tech Industries (12.9%). With an unseasoned portfolio, the company had one portfolio company on non-accrual representing 1.6% and 1.2% of the investment portfolio at cost and fair value, respectively, with 98.8% of the portfolio internally rated as performing at or above underwriting expectations.

The company has three secured bank facilities, including a revolving credit facility and two secured SPV asset facilities. Liquidity is solid with $277.8 million in available credit lines and $30.5 million in cash set against $202.9 million of unfunded commitments and no near-term debt maturities. As a perpetual-life BDC, the company raises capital monthly and offers share tenders quarterly. Since inception on December 21, 2021, through June 1, 2025, the company raised $640.4 million in equity with just $2.0 million in redemptions. As of March 31, 2025, the company had 14.6% of its portfolio in more liquid BSLs to further support liquidity but may increase this allocation as needed. To increase financial flexibility, the company intends to issue its inaugural senior unsecured notes in the near term.

As of March 31, 2025, the company’s gross and net (of cash) leverage were 1.06x and 0.99x, respectively, which is within the company's target net leverage range of 0.75x-1.25x. Asset coverage is solid at 194.2% when considering its 150% regulatory asset coverage, providing the company a 29% cushion and the ability to withstand additional market volatility in a less favorable economic environment.

Counterbalancing these strengths are the fully secured funding profile and the elevated level of secured debt to gross assets of ~47% as of March 31, 2025. However, with the anticipated unsecured debt issuance, the funding profile will improve. Further counterbalancing the strengths are the potential risks related to BCPC’s illiquid assets, an unseasoned investment portfolio due to its short operating history, retained earnings constraints as a RIC, and uncertain economic environment with high base rates, inflation, and geopolitical risks.

BCPC is an externally managed, non-diversified investment management company that elected to be treated as a Business Development Company (BDC) under the 1940 Act and as a RIC, which, among other things, must distribute to its shareholders at least 90% of the company’s investment taxable income. The company was formed as a Delaware statutory trust in December 2021 and commenced operations November 28, 2023. The company is managed by BCSF Advisors, LP, a subsidiary of Bain Capital Credit, which is a wholly owned subsidiary of Bain Capital, LP, which had approximately $185 billion in AUM as of December 31, 2024.

Rating Sensitivities

Given the Stable Outlook, a rating upgrade is not expected in the medium term. Rating pressure is possible if a prolonged downturn in the U.S. economy has a material impact on earnings performance, including increased non-accruals and a significant rise in leverage. An increased focus on riskier investments or a change in the current management structure and/or a change in strategy and risk management that negatively impact credit metrics could also pressure ratings.

To access ratings and relevant documents, click here.

Methodologies

• Financial Institutions: Finance Company Global Rating Methodology
• ESG Global Rating Methodology

Disclosures

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA), one of the major credit rating agencies (CRA), is a full-service CRA registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a Designated Rating Organization (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan’s Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S.

Doc ID: 1010403

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