Capital Call Finance – Outlook 2026
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Capital call finance enters 2026 on a solid footing. While supply has been somewhat subdued in recent months due to developments in underlying markets, a clear
increase in activity is emerging.
Spread compression continues into early 2026. Despite this spread compression, capital call finance remains an attractive relative investment opportunity, offering a
consistent spread pickup of 125-130 bps versus short term IG corporate bonds.
We continue to observe growing activity in the term loan market. Both borrowers and banks are increasingly sensitive to arguments to combine more traditional RCFs
with term loan tranches. In the USD market, and gradually more in the EUR markets as well, we observe maturities of these term loans extending to 2, 3 or 4 years, with limited pick-up in spread.
Credit performance is expected to stay strong with credit deterioration remaining largely absent. This strong performance reflects both the robust structural features of the capital call facilities, with backing of a high quality and diversified LP base, and the continued solid performance of private market funds.
