Private Credit: Outsized Promise in the Middle Market

Sep 09, 2025

 

PGIM examines private credit investing dynamics, particularly in middle market lending.

Private credit presents significant opportunities, particularly in middle market direct lending. In this new piece, PGIM's Dianna Carr-Coletta shares insights on market dynamics, investment opportunities, and key risks in an increasingly competitive market. Key takeaways include:

  • Stronger protections: Middle market loans often include maintenance covenants, lower leverage, and more favourable terms, offering more downside protection than covenant-lite upper market deals. 

  • Diversified origination: Access to both sponsored and non-sponsored deals allows investors to capture relative value and avoid overexposure to the LBO cycle.

  • Defensive positioning: With low correlation to public markets and stable performance across cycles, private credit continues to prove its value in volatile environments.

In a competitive market with limited M&A activity, disciplined managers with differentiated sourcing strategies are best positioned to deliver. Read on to discover how middle market private credit can strengthen your portfolio.


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