Skip to main content

Covenant protections for new-issue private credit loans (PCs) have improved in 2023 amid tighter lending conditions, following the trend in the broadly syndicated market.


On average, the Documentation Score of private credits tightened to 2.84 on Covenant Review’s scale of 1 (most protective) to 5 in the year to Oct. 31 (YTD) from 2.94 in 2022. Likewise, the average Score among Broadly Syndicated Loans (BSLs) strengthened to 3.64 YTD from 3.75 in 2022.

The trend toward stricter PC protections in 2023 was driven, in part, by few loans with covenant-lite structures. YTD, 20% of PC loans in Covenant Review’s sample cleared without maintenance financial tests, down from 30% in 2022 and a peak of 31% in 2021. In the BSL market, by contrast, the share in the YTD was unchanged from 2022’s level at 93%. The decline was felt across the size spectrum as the chart on the right illustrates.

Other underlying factors at work here include less generous baskets as well (left chart) as well as a falling proportion of highly negotiated terms such as MFN sunsets and asset-sales-sweep step-downs (right chart).

Large PC vs BSL Loans

The jumbo PC loan of $1 billion or more is a relatively recent phenomenon. Starting in 2021, the first year for which there is a statistically significant sample, the trend in private credit follows the syndicated market as the charts ahead show. For example, the average Documentation Score of PCs improved to 2.9 in the YTD from 3.3 in 2022. In the BSL market, likewise, the average trended to 3.7 from 3.9.

We have pulled some key insights from Covenant Review’s proprietary database of more than 1300 private credit institutional loans going back to 2017. Private credit loan documentation remains strong, even considering the recent trend towards mega private credit tranches. In fact, new issue private credit covenants strengthened in 2023 with the share of covenant-lite private credit loans falling from 30% in 2022 to 20% YTD. Our analysis is available to subscribers across CreditSights’ three content sets – CreditSights Fundamental Research, Covenant Review, and LevFin Insights.

For additional covenant stats or other cuts of the data, please contact

For subscription information or other Covenant Review content, please contact


Steve Miller
CEO of Fulcrum Financial Data


This Report is for informational purposes only. Neither the information contained in this Report, nor any opinion expressed therein is intended as an offer or solicitation with respect to the purchase or sale of any security or as personalized investment advice. CreditSights and its affiliates do not recommend the purchase or sale of financial products or securities, and do not give investment advice or provide any legal, auditing, accounting, appraisal, valuation or actuarial services. Neither CreditSights nor the persons involved in preparing this Report or their respective households has a financial interest in the securities discussed herein. Recommendations made in a report may not be suitable for all investors and do not take into account any particular user’s investment risk tolerance, return objectives, asset allocation, investment horizon, or any other factors or constraints. Information included in any article that includes analysis of documents, agreements, controversies, or proceedings is for informational purposes only and does not constitute legal advice. No attorney client relationship is created between any reader and CreditSights as a result of the publication of any research report, or any response provided by CreditSights (including, but not limited to, the ask an analyst feature or any other analyst interaction) or as the result of the payment to CreditSights of subscription fees. The material included in an article may not reflect the most current legal developments. We disclaim all liability in respect to actions taken or not taken based on any or all the contents of any research report or communication to the fullest extent permitted by law. Reproduction of this report, even for internal distribution, is strictly prohibited. Receipt and review of this research report constitutes your agreement not to redistribute, retransmit, or disclose to others the contents, opinions, conclusion or information contained in this report (including any investment recommendations or estimates) without first obtaining express permission from CreditSights. The information in this Report has been obtained from sources believed to be reliable; however, neither its accuracy, nor completeness, nor the opinions based thereon are guaranteed. The products are being provided to the user on an “as is” basis, exclusive of any express or implied warranty or representation of any kind, including as to the accuracy, timeliness, completeness, or merchantability or fitness for any particular purpose of the report or of any such information or data, or that the report will meet any user’s requirements. CreditSights may issue or may have issued other reports that are inconsistent with or may reach different conclusions than those represented in this Report, and all opinions are reflective of judgments made on the original date of publication. CreditSights is under no obligation to ensure that other reports are brought to the attention of any recipient of the Products. Certain data appearing herein is owned by, and used under license from, certain third parties. Please see Legal Notices for important information and limitations regarding such data. For terms of use, see Terms & Conditions.
If you have any questions regarding the contents of this report contact CreditSights at
© 2023. CreditSights, Inc. All rights reserved.