Blackstone Secured Lending Fund (BXSL) Raymond James & Associates’ 46th Annual Institutional Investors Conference 2025 summary

Market overview and private credit trends

• Private credit has delivered private equity-like returns with debt-like instruments due to supply-demand imbalances, but this is not expected to last indefinitely.

• There is a long-term secular shift toward private credit, with its definition expanding to include real assets and contractual income flows.

• Private equity and private credit have grown symbiotically, with private credit now a key tool for larger private equity transactions.

• High all-in yields have persisted across rate environments, averaging around 11%, and are expected to remain elevated.

• Lower rates could spur more deployment and healthier credit fundamentals, supporting portfolio resilience.

M&A and deployment outlook

• Despite a slow start to M&A in 2024, a robust cycle is anticipated in 2025 due to $5 trillion in private equity dry powder and a more favorable regulatory environment.

• Private equity firms must deploy capital within finite investment periods, increasing pressure for deal activity.

• Sectors like energy transition and digital infrastructure are expected to see significant capital needs and fundraising.

• Private credit portfolios are healthier, with lower loan-to-value ratios and stronger underwriting standards.

• Private credit continues to command a premium over liquid loan markets due to its strategic advantages.

BXSL portfolio strategy and performance

• BXSL focuses on direct lending with an emphasis on scale, sector selection, and seniority, targeting sectors with lower default rates.

• As of Q4 2024, 98% of investments are in first-lien senior secured loans, with 99% to sponsor-owned companies and sub-50% LTV.

• Portfolio quality is highlighted by non-accruals at 30 basis points, well below peers, and an average borrower EBITDA near $200 million.

• BXSL seeks attractive risk-adjusted returns across company sizes, with a focus on interest coverage and defensive positioning.

• Liability management includes 39% unsecured bonds with sub-3% coupons, no maturities until 2026, and three IG ratings with recent upgrades.