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Chart of the Week
Jun 6, 2025
2 MIN READ

Private credit: Steady performance through market cycles

Private credit’s income-based returns over the past 20 years have far exceeded losses, even during periods of market stress.
Christopher Bole
Vice President, Financial Writer
VIEW BIO

Direct lending historical income and realized losses

Source: Cliffwater, as of March 31, 2025.
  • Over the last decade, private credit has evolved from a specialized, niche asset class into a critical financing channel in global capital markets.
  • Both institutions and individuals have been drawn to private credit for its yield premium and stronger lender protections relative to public markets.
  • As an income-driven asset class, private credit has benefited meaningfully from the elevated rate environment of the past several years, while also proving resilient over longer time frames.
  • As the chart illustrates, direct lending’s trailing one-year income-based return has exceeded realized losses every quarter since 2005—even during periods of heightened market stress like the great financial crisis, the European sovereign debt crisis, the 2015–2016 energy downturn and the COVID-19 pandemic.1
  • As markets settle into what may be a prolonged period of uncertainty driven by a shifting landscape of tariffs, economic data and interest rates, private credit has proven its worth over multiple market cycles.
contributing authors
Christopher Bole
Vice President, Financial Writer
view bio
Disclosures & Footnotes

1. Cliffwater, as of March 31, 2025.

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