Private Debt | Grab your compass - navigating the next credit cycle
Sep 10, 2026 — 11:00 am - 11:30 AMSummit Room 1
Private credit's golden age is facing its most serious stress test. The aggressive lending vintages of 2021 and 2022 are now colliding with a higher-for-longer rate environment, with interest coverage ratios for many mid-market firms falling below 1.0x. Payment default rates have historically sat at 1–2%, but covenant defaults reached 3.2% last September and are expected to rise further. With software companies in particular facing AI threats to future sustained growth, how bad could things become in the coming years? Does the rise of ‘bad PIK’, which reached 6.4% of total private debt volume in Q1 2026, suggest a gathering storm? This panel will assess the real shape of portfolio risk: what early-warning signals are being acted on, and what tools — covenant enforcement, sponsor equity injections, sector rotation — are being deployed to protect capital?