New Mountain Private Credit Fund's Net Assets Halved Amidst Unrealized Losses

TL;DR

**New Mountain Private Credit Fund is bleeding unrealized value and its operational income is down big, signaling rough waters ahead for investors.**

AI Summary

New Mountain Private Credit Fund reported a net increase in net assets from operations of $38,593 thousand for the nine months ended September 30, 2025, compared to $80,194 thousand for the same period in 2024, representing a significant decrease of 51.8%. Total investment income for the nine months ended September 30, 2025, was $125,899 thousand, down from $162,542 thousand in the prior year, a 22.5% reduction. Net investment income also decreased to $71,966 thousand from $84,692 thousand. The fund experienced net realized losses on investments of $8,945 thousand and a net change in unrealized depreciation of investments of $24,428 thousand for the nine months ended September 30, 2025, contrasting with net realized losses of $15,677 thousand and net unrealized appreciation of $11,324 thousand in the prior year. Total investments at fair value increased to $1,592,430 thousand as of September 30, 2025, from $1,495,564 thousand at December 31, 2024. Borrowings increased, with the GS Credit Facility at $443,000 thousand and a new NEWCRED Credit Facility at $169,000 thousand, while Unsecured Notes decreased from $200,000 thousand to zero. Net assets per share declined to $24.31 from $25.07.

Why It Matters

This filing reveals a significant decline in New Mountain Private Credit Fund's operational performance, with net assets from operations decreasing by over 50% year-over-year. The substantial net change in unrealized depreciation of investments, totaling $24,428 thousand, indicates potential valuation challenges within its portfolio, which could impact future returns for investors. The increase in borrowings, particularly the new NEWCRED Credit Facility, suggests a shift in financing strategy or increased leverage, potentially raising risk in a competitive private credit market. This could signal a more challenging environment for similar private credit funds and their investors, as well as for the companies they lend to.

Risk Assessment

Risk Level: high — The fund reported a net change in unrealized depreciation of investments of $24,428 thousand for the nine months ended September 30, 2025, a stark reversal from $11,324 thousand in unrealized appreciation in the prior year. Additionally, net increase in net assets from operations plummeted by 51.8% from $80,194 thousand to $38,593 thousand, indicating significant underperformance and potential asset quality issues.

Analyst Insight

Investors should scrutinize the underlying assets contributing to the $24,428 thousand in unrealized depreciation and consider the implications for future distributions. Given the substantial decline in net investment income and the increased leverage, a cautious approach is warranted; consider reducing exposure or re-evaluating the fund's long-term viability.

Financial Highlights

debt To Equity

0.61

revenue

$125,899,000

operating Margin

N/A

total Assets

$1,684,344,000

total Debt

$602,539,000

net Income

$38,593,000

eps

$24.31

gross Margin

N/A

cash Position

$78,139,000

revenue Growth

-22.5%

Revenue Breakdown

Key Numbers

• $38.6M — Net increase in net assets from operations (Down 51.8% from $80.2M in the prior year period.)
• $125.9M — Total investment income (Decreased 22.5% from $162.5M in the prior year period.)
• $72.0M — Net investment income (Decreased from $84.7M in the prior year period.)
• ($8.9M) — Net realized losses on investments (Improved from ($15.7M) in the prior year period.)
• ($24.4M) — Net change in unrealized depreciation of investments (A significant reversal from $11.3M in appreciation in the prior year period.)
• $1.59B — Total investments at fair value (Increased from $1.49B at December 31, 2024.)
• $443.0M — GS Credit Facility (Increased from $374.7M at December 31, 2024.)
• $169.0M — NEWCRED Credit Facility (New borrowing facility as of September 30, 2025.)
• $24.31 — Net Assets per share (Decreased from $25.07 at December 31, 2024.)
• 42,632,547 — Common shares outstanding (As of November 12, 2025.)

Key Players & Entities

• New Mountain Private Credit Fund (company) — registrant
• Bloomberg (company) — publisher
• SEC (regulator) — filing authority
• $38,593 thousand (dollar_amount) — net increase in net assets from operations for 9 months ended Sep 30, 2025
• $80,194 thousand (dollar_amount) — net increase in net assets from operations for 9 months ended Sep 30, 2024
• $125,899 thousand (dollar_amount) — total investment income for 9 months ended Sep 30, 2025
• $162,542 thousand (dollar_amount) — total investment income for 9 months ended Sep 30, 2024
• $24,428 thousand (dollar_amount) — net change in unrealized depreciation of investments for 9 months ended Sep 30, 2025
• $1,592,430 thousand (dollar_amount) — total investments at fair value as of Sep 30, 2025
• $24.31 (dollar_amount) — net assets per share as of Sep 30, 2025

FAQ

Risk Factors

• Increased Borrowings and Leverage [high — financial]: Total borrowings increased to $602.5 million as of September 30, 2025, up from $567.6 million at December 31, 2024. This includes a new $169 million NEWCRED Credit Facility, while Unsecured Notes were paid down. Increased leverage amplifies both potential gains and losses.
• Unrealized Depreciation Impact [high — market]: The fund experienced a net change in unrealized depreciation of $24.4 million for the nine months ended September 30, 2025. This is a significant reversal from $11.3 million in unrealized appreciation in the prior year, indicating a decline in the fair value of underlying investments.
• Decline in Investment Income [medium — financial]: Total investment income decreased by 22.5% to $125.9 million for the nine months ended September 30, 2025, compared to $162.5 million in the prior year. This decline in income directly impacts net investment income and overall fund performance.
• Reduced Net Assets from Operations [high — financial]: The net increase in net assets from operations fell by 51.8% to $38.6 million for the nine months ended September 30, 2025, from $80.2 million in the prior year. This substantial decrease reflects the combined impact of lower investment income and unrealized losses.
• Fair Value of Investments [medium — market]: Total investments at fair value increased to $1.59 billion as of September 30, 2025, from $1.49 billion at December 31, 2024. However, the significant unrealized depreciation suggests potential valuation challenges or market headwinds affecting the portfolio.
• Increased Expenses [medium — financial]: While total investment income decreased, interest and other financing expenses increased to $29.9 million from $49.0 million in the prior year period. Management and incentive fees also saw fluctuations, impacting net investment income.

Industry Context

The private credit market continues to be a dynamic sector, characterized by increasing demand for flexible financing solutions from middle-market companies. However, rising interest rates and economic uncertainty are creating a more challenging environment, leading to increased credit risk and potential for higher defaults. Funds are adapting by focusing on defensive sectors and employing more conservative underwriting standards.

Regulatory Implications

Private credit funds operate under evolving regulatory scrutiny, particularly concerning disclosures, leverage, and investor protection. Changes in accounting standards or new regulations could impact valuation methodologies, reporting requirements, and operational costs for funds like New Mountain Private Credit Fund.

What Investors Should Do

1. Monitor the impact of increased leverage on fund volatility and risk-adjusted returns, given the rise in total borrowings to $602.5 million.
2. Analyze the drivers behind the significant unrealized depreciation of $24.4 million and assess the outlook for the fund's investment portfolio.
3. Evaluate the sustainability of fee income growth and its contribution to overall profitability in light of declining interest and dividend income.
4. Assess the fund's ability to manage its increased debt obligations, particularly with the new $169 million NEWCRED Credit Facility.
5. Compare the fund's performance metrics (net investment income, net assets per share) against peers to gauge relative strength in the current market.

Key Dates

• 2025-09-30: Nine months ended September 30, 2025 — Period reflects a significant decrease in net assets from operations, lower investment income, and substantial unrealized depreciation.
• 2024-09-30: Nine months ended September 30, 2024 — Prior period showed strong performance with higher investment income and net assets from operations, and unrealized appreciation.
• 2025-12-31: As of December 31, 2024 — Reference point for year-end financial position, showing lower total investments and borrowings compared to September 30, 2025.
• 2025-11-12: Common shares outstanding as of November 12, 2025 — Indicates the number of shares outstanding for per-share calculations, which was 42,632,547.

Glossary

PIK interest income

Payment-in-kind interest income, where interest is paid in the form of additional debt or equity rather than cash. (This form of income decreased significantly, contributing to the overall decline in investment income.)

Net realized losses on investments

Losses incurred when investments are sold for less than their carrying value. (While these losses improved year-over-year, they still represent a drag on fund performance.)

Net change in unrealized depreciation of investments

The decrease in the fair value of investments that are still held by the fund. (A substantial increase in unrealized depreciation indicates a negative market sentiment or performance of the fund's holdings.)

GS Credit Facility

A credit facility provided by Goldman Sachs, used by the fund for borrowing. (The balance on this facility increased, indicating greater reliance on debt financing.)

NEWCRED Credit Facility

A new credit facility established by the fund, likely for additional borrowing capacity. (The introduction of this facility signifies an expansion of the fund's leverage.)

Additional Paid in Capital

The amount of capital contributed by investors in excess of the par value of shares. (This account increased, reflecting new capital raised or retained earnings.)

Accumulated Retained earnings (loss)

The cumulative net income or loss of the fund that has not been distributed to shareholders. (This account shows a significant loss, contributing to the decrease in net assets per share.)

Year-Over-Year Comparison

Compared to the prior year period, New Mountain Private Credit Fund has experienced a significant downturn. Total investment income decreased by 22.5% to $125.9 million, and net investment income also declined. Most notably, the net increase in net assets from operations plummeted by 51.8% to $38.6 million. This is largely attributable to a substantial shift from unrealized appreciation of $11.3 million to unrealized depreciation of $24.4 million, indicating a weakening in the fair value of the fund's investments.

Filing Documents

• newcred-20250930.htm (10-Q) — 6659KB
• newcred-09302025xexhibit311.htm (EX-31.1) — 9KB
• newcred-09302025xexhibit312.htm (EX-31.2) — 9KB
• newcred-09302025xexhibit321.htm (EX-32.1) — 4KB
• newcred-09302025xexhibit322.htm (EX-32.2) — 4KB
• 0002037804-25-000020.txt ( ) — 25873KB
• newcred-20250930.xsd (EX-101.SCH) — 85KB
• newcred-20250930_cal.xml (EX-101.CAL) — 76KB
• newcred-20250930_def.xml (EX-101.DEF) — 541KB
• newcred-20250930_lab.xml (EX-101.LAB) — 807KB
• newcred-20250930_pre.xml (EX-101.PRE) — 594KB
• newcred-20250930_htm.xml (XML) — 4495KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION Item 1.

Financial Statements

Financial Statements Consolidated Statements of Assets and Liabilities as of September 30, 2025 (unaudited) and December 31, 2024 3 Consolidated Statements of Operations of Successor for the three and nine months ended September 30 , 2025 (unaudited) and the Predecessor for three and nine months ended September 30 , 2024 (unaudited) 4 Consolidated Statements of Changes in Net Assets of Successor for the three and nine months ended September 30, 2025 (unaudited) and Predecessor's Members' Capital for the three and nine months ended September 30, 2024 (unaudited) 5 Consolidated Statements of Cash Flows of Successor for the nine months ended (unaudited) September 30, 2025 and Predecessor for the nine months ended September 30, 2024 (unaudited) 6 Consolidated Schedule of Investments as of September 30, 2025 (unaudited) 7 Consolidated Schedule of Investments as of December 31, 2024 25 Notes to the Consolidated Financial Statements of New Mountain Private Credit Fund (unaudited) 38 Report of Independent Registered Public Accounting Firm 67 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 68 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 82 Item 4.

Controls and Procedures

Controls and Procedures 83

OTHER INFORMATION

PART II. OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 84 Item 1A.

Risk Factors

Risk Factors 84 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 84 Item 3. Defaults Upon Senior Securities 85 Item 4. Mine Safety Disclosures 85 Item 5. Other Information 85 Item 6. Exhibits 86

Signatures

Signatures 87 2 Table of Contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements New Mountain Private Credit Fund Consolidated Statements of Assets and Liabilities (in thousands, except shares and per share data) (unaudited) September 30, 2025 December 31, 2024 Assets Investments at fair value Non-controlled/non-affiliated investments at fair value (cost of $ 1,613,857 and $ 1,524,545 , respectively) $ 1,560,430 $ 1,495,564 Controlled investments at fair value (cost of $ 32,000 and $ — , respectively) 32,000 — Total investments at fair value (cost of $ 1,645,857 and $ 1,524,545 , respectively) 1,592,430 1,495,564 Cash and cash equivalents 78,139 66,683 Interest and dividend receivable 13,086 8,772 Deferred tax asset 6 7 Receivable from affiliate — 7 Other assets 683 441 Total assets $ 1,684,344 $ 1,571,474 Liabilities Borrowings GS Credit Facility $ 443,000 $ 374,707 NEWCRED Credit Facility 169,000 — Unsecured Notes — 200,000 Deferred financing costs (net of accumulated amortization of $ 4,888 and $ 12,133 , respectively) ( 9,461 ) ( 7,148 ) Net borrowings 602,539 567,559 Payable for unsettled securities purchased 12,015 19,036 Subscriptions received in advance 6,065 — Distribution payable 8,112 — Interest payable 9,170 4,560 Incentive Fee Payable 3,229 496 Management fee payable 3,324 492 Payable to affiliate 477 — Payable for share repurchases 9,407 — Other liabilities 1,846 1,151 Total liabilities 656,184 593,294 Commitments and contingencies (See Note 8) Net Assets Common shares, $ 0.001 par value ( 42,287,209 and 39,025,005 ) shares issued and outstanding, respectively 42 39 Additional Paid in Capital 1,076,442 995,040 Accumulated Retained earnings (loss) ( 48,324 ) ( 16,899 ) Total net assets $ 1,028,160 $ 978,180 Total liabilities and net assets $ 1,684,344 $ 1,571,474 Net Assets per share $ 24.31 $ 25.07 The accompanying notes are an integral part of these consolidated financial statements. 3 Table of Contents New Mountain Private Credit Fund Cons

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