US Private Credit Default Rate Dips in Third Quarter

The private credit default rate fell to 2.41 percent for the period ending September 30, 2026.

Updated on Oct. 29, 2026 in Economic Indicators

Isometric editorial illustration showing a stack of heavy steel beams on a concrete base, symbolizing market stability. — The US private credit default rate declined to 2.41 percent in the third quarter of 2026, according to the latest Proskauer index. AI Illustration. Upload story photo >

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The US private credit default rate declined to 2.41 percent in the third quarter of 2026, down from 2.51 percent in the second quarter. The Proskauer Private Credit Default Index tracked 746 loans with an original principal amount of $205.7 billion.

Why it matters

Changes in default rates offer insight into the financial health of businesses relying on private credit for operational capital. While aggregate defaults slowed, divergence in performance across borrower sizes highlights shifting risk profiles in the credit market.

The index, which monitors 746 senior-secured and unitranche loans, reported a decrease in the default rate to 2.41 percent for the third quarter of 2026. Data shows the default rate for companies with EBITDA over $50 million fell significantly to 1.7 percent.

The players

Proskauer Private Credit Default Index

This index tracks the performance and default status of senior-secured and unitranche loans within the United States credit market.

The details

Borrowers with an EBITDA of less than $25 million saw their default rate increase to 2.2 percent from 1.9 percent in the prior quarter. Conversely, companies with an EBITDA between $25 million and $49.9 million experienced a slight dip, with the default rate moving from 3.4 percent to 3.3 percent.

The default rate was 2.51 percent during Q2 2026.
The default rate was 2.41 percent during Q3 2026.

Macro View

The current report provides a snapshot of borrower stress levels relative to the historical performance cycles captured by the Proskauer Private Credit Default Index. These quarterly fluctuations reflect the broader volatility often seen as companies navigate shifts in credit market conditions.

For borrowers and investors, a tightening in credit performance often signals potential changes in loan availability and interest terms. These shifts can influence the broader availability of capital for companies across different sectors, impacting business expansion and operating budgets.

The takeaway

While the aggregate default rate shows improvement, increased stress among smaller companies suggests that access to credit remains varied. Investors should continue to monitor trailing 12-month data to identify emerging trends in credit quality.