Cardo AI’s Credit BDC Sector Monitor reads loan-level SEC filings bottom-up to show what BDC portfolios hold, what they earn and how they mark it. The second edition (see here the first) widens the universe from 53 to 85 BDCs (33 listed and 52 non-traded), covering 37,906 loans and 253,195 quarterly floating-rate observations, with data through 2026-Q2.

The central finding is that pricing and marks have come apart. The compression in new-issue spreads that ran from 2023 to 2025 has paused, and sector pricing sits inside a 50 bps band. The held book tells a different story: managers already mark Media, Healthcare and Technology positions for stress while pricing their new loans like everything else. That gap is what the monitor is built to surface.

1. Compression has paused. The all-sector median new-issue spread ran 600 / 525 / 475 / 475 bps across 2023, 2024, 2025 and 2026 year-to-date. Quarterly cohorts went 465, 475 and 500 bps over the last three quarters. The 2026-Q2 widening sits in Consumer (525 bps) and Healthcare (500 bps).
2. Marks separate sectors where spreads do not. The share of seasoned loans marked below 0.85 runs from 15.3% in Media, 11.8% in Healthcare and 11.3% in Technology to 6.7% in Financials. New loans in those sectors price within 50 bps of Financials. Healthcare combines the worst public default record of the ten sectors with new-loan pricing only 25 bps over Financials.
3. Technology is the watch item. The share of Technology loans marked below 0.95 went from 12.1% to 21.5% in a year, while the new-issue median held at 475 bps. Twelve of 54 funds now mark the sector below 0.95, and the mark fell in 29 of 51 funds, so the move is broad rather than concentrated.
4. Funds agree on performing loans and disagree on stressed ones. Across 1,187 shared borrowers, the median gap between funds is 0.3 points. Among the 82 shared borrowers marked below 0.90, 29% carry gaps above 10 points. The same loan can sit 20 to 40 points apart in two books.
5. Manager selection dominates sector selection. Book marks run from 0.836 to 1.004 across 79 funds, and fund deep-discount shares from 0.0% to 40.8%, inside a 50 bps sector spread band. 27 of 85 funds clear our manager filter.

Takeaways

For GPs: the 54 bps spread advantage on 2023 and 2024 loans closes as they repay. If your book is heavy in Healthcare or Media, expect LPs to ask about your marks before your spreads. Publish your own figure first.

For LPs: pick the manager before the sector.

• Screen: a seasoned book mark of 0.96 or better and a weighted average spread of 500 to 650 bps.
• Question: funds pairing a spread above roughly 650 bps with a double-digit deep-discount share.
• Monitor: share of loans at or below 0.90 (universe 9.2%), Technology loans below 0.95 (21.5%), and gap to the other holders of shared loans.
• Size on the tail: the modelled worst-1% loss runs from 12.0% to 17.4% of the book across loss assumptions.