NEW YORK, July 23, 2025 – Proskauer, a leading international law firm, today released its latest Private Credit Default Index (the "Index"), which tracks senior-secured and unitranche loans in the United States. The Index revealed a default rate of 1.76% for the period of April 1, 2025 – June 30, 2025. The rate is lower than that of Q1 2025 (2.42%) and is the second consecutive quarter that the overall default rate decreased after rising to 2.67% in Q4 2024. The decrease in default rate from Q1 2025 to Q2 2025 remains consistent with the trend in the broadly syndicated market.
This quarter's Index encompasses 739 loans representing $143.6 billion in original principal amount.
"This quarter's data reinforces what we've continued to see: resilience across private credit markets. While there was a slight uptick in defaults among smaller companies, the overall downward trend signals effective risk management and stability across the sector. As capital continues to flow and lenders remain disciplined, the market is demonstrating its ability to navigate evolving macro conditions." said Stephen A. Boyko, partner and co-founder of Proskauer's Private Credit Group.
We saw both increases and decreases in the three EBITDA bands that the Index tracks. In companies with EBITDA of less than $25 million, defaults increased from 1.4% in Q1 2025 to 1.8% in Q1 2025.For those with EBITDA of $25 million to $49.9 million, we observed a significant decrease in the default rate from 4.3% in Q1 2025 to 2.9% in Q2 2025. Companies with EBITDA equal to or greater than $50 million fell from 1.7% in Q1 2025 to 0.5% in Q2 2025.
The Proskauer Index contains a comparison to default rates published by the rating agencies, historical trends by industry and EBITDA bands, defaults by type, defaults in cov-lite loans and defaults by year of origination. The full report is available only to the Firm's direct lending clients.