Intelligence Feed event · Credit · 2026-09-12

    Houlihan Lokey flags rising stress in private credit for sub-$100M EBITDA borrowers

    Question

    Houlihan Lokey flags rising stress in private credit for sub-$100M EBITDA borrowers

    Direct answer

    Data from Houlihan Lokey shows growing bifurcation across the private debt universe, with smaller borrowers under pressure from elevated base rates. The $10M-$20M EBITDA category experienced a notable deterioration, with 12% of debt marked below 90 cents on the dollar, up twelvefold from 2023 levels.

    Original publisher
    Market Ontology
    Evidence through
    2026-09-12
    Published
    2026-10-20
    Revision
    1 · 2026-10-20

    Cite as: Market Ontology, “Houlihan Lokey flags rising stress in private credit for sub-$100M EBITDA borrowers”, revision 1, evidence through 2026-09-12. https://marketontology.com/market-events/2026-09-12/houlihan-lokey-flags-rising-stress-in-private-credit-for-sub-100m-ebitda-borrowe-c3e9e7

    CREDIT
    Houlihan Lokey flags rising stress in private credit for sub-$100M EBITDA borrowers
    Data from Houlihan Lokey shows growing bifurcation across the private debt universe, with smaller borrowers under pressure from elevated base rates. The $10M-$20M EBITDA category experienced a notable deterioration, with 12% of debt marked below 90 cents on the dollar, up twelvefold from 2023 levels.
    HLI
    Impact
    75
    SEP 12
    SIG
    88%
    HLI
    Houlihan Lokey flags rising stress in private credit for sub-$100M EBITDA borrowers
    Data from Houlihan Lokey shows growing bifurcation across the private debt universe, with smaller borrowers under pressure from elevated base rates. The $10M-$20M EBITDA category experienced a notable deterioration, with 12% of debt marked below 90 cents on the dollar, up twelvefold from 2023 levels.
    → Rising default rates to 3% among sub-$100M EBITDA borrowers increases risk premiums in lower-middle-market direct lending, widening private debt spreads and tightening credit conditions.
    Impact
    Data from Houlihan Lokey shows growing bifurcation across the private debt universe, with smaller borrowers under pressure from elevated base rates. The $10M-$20M EBITDA category experienced a notable deterioration, with 12% of debt marked below 90 cents on the dollar, up twelvefold from 2023 levels.
    Affected
    HLI
    Transmission
    Rising default rates to 3% among sub-$100M EBITDA borrowers increases risk premiums in lower-middle-market direct lending, widening private debt spreads and tightening credit conditions.

    How this development reaches the affected companies

    AssetExposure and channelDirectionEvidence
    HLIrestructuring advisory fee revenue growth from distressed middle-market creditsUp1-3mHoulihan Lokey research highlights rising restructuring candidate pool.

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    What happened next

    Price follow-up pending — no stored daily closes for these assets yet.

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