Goldman Sachs BDC reported a net asset value per share of $12.17 at the end of March, representing a 3.7% decline from the previous quarter, according to a late Thursday filing reported by The Economic Times. The private credit fund experienced an increase in unrealized losses and mark-downs during the first quarter, marking the first decline in the fund's value since its inception. The company reported a net investment income per share of $0.22 for the quarter, but posted an earnings per share of $(0.12), highlighting the volatility in the portfolio's mark-to-market value.
The fund disclosed a pick-up in non-accruals to 3.2% of its total investment portfolio at fair value, compared to 2.8% in the previous quarter, as reported by The Economic Times. Goldman Sachs spokesperson attributed these modest unrealized moves primarily to broader market spread widening rather than credit deterioration. The company noted that legacy loans underwritten before March 2022, when the current management team took over, accounted for the vast majority of non-accruals. The portfolio also saw two new non-accrual placements during the quarter, signaling continued stress in the credit portfolio.
Approximately 60% of mark-downs in the fund's portfolio were attributed to borrower-specific events, with the most significant impact from two legacy loans to borrowers 1GI LLC and 3SI Security Systems, according to management comments reported by The Economic Times. The fund made new commitments of roughly $46.5 million across 17 companies, including six new borrowers, and received $82.8 million in loan repayments during the first quarter, with more than half on loans originated before 2022. The portfolio maintains a 98.7% senior secured debt composition, with 97.1% in first-lien investments, designed to provide priority claims on collateral.
The fund declared a dividend of 32 cents per share for the second quarter 2026, maintaining the same level for several quarters, as reported by The Economic Times. However, the thin margin of $0.22 net investment income per share against the $0.32 quarterly dividend creates vulnerability. The net investment income yield on book value of 7.2% annualized for the quarter serves as the primary source of cash flow for distributions, but the 3.7% NAV decline indicates the portfolio's asset base is eroding. A shrinking NAV per share reduces the capital cushion available to support distributions, even with stable yields, creating a classic risk-adjusted return dilemma where high yields offer attractive income but NAV volatility introduces significant drawdown risk.
