BLK
TCPC
The markdown monster came calling
BlackRock TCP Capital Corp. (TCPC) just reminded investors that private credit isn’t a magical yield fountain — sometimes it’s just a very expensive game of musical chairs. The fund cut the value of its portfolio by roughly 5%, with $35 million in net markdowns during the first quarter, dragging NAV down 4.9% to $6.72 per share.
That’s the kind of number that makes income investors sit up straight. Why? Because markdowns aren’t just accounting fluff — they can signal real pressure in the underlying loans, especially when distressed names and weak recoveries start piling up.
The good news is... not terrible
To its credit, TCPC didn’t walk in wearing a full disaster costume. The company said non-accruals improved to 2.8% of the portfolio at fair value, helped by two restructurings and one successful asset sale. Net leverage also eased to 1.29x, which is the sort of boring balance-sheet progress that usually doesn’t get applause but absolutely matters when credit markets get wobbly.
Still, the fund’s own activity shows it’s not exactly playing defense only. TCPC invested $22.5 million across six new and two existing portfolio companies, with most of that going into senior secured loans. Translation: the team is still deploying capital, but it’s doing so with one eye on risk and the other on the exits.
Why investors should care
If you own TCPC, this is the classic private-credit trade-off in action: high-ish income on one side, but also the occasional portfolio bruise on the other. And because TCPC trades publicly, those bruises show up fast in the stock price. The shares are still down sharply for the year, even after a tiny bounce in the latest session.
Meanwhile, BlackRock is leaning deeper into private credit overall, including expanding analytics capabilities on Preqin and integrating its newly acquired HPS platform. Big picture: BlackRock wants to be the landlord of the private-credit neighborhood — but the tenants are still under pressure, and TCPC is feeling the rent.