Here we compare the private credit and bank loan markets. From a sector standpoint, as we show on the left, private credit tends to have higher exposure to information technology and financials, while the leveraged loans market tends to have notably higher exposure to industrials, consumer discretionary, communication services, and materials. On the top right, we show the % of middle market and large middle market loans that are covenant-lite. More than 50% of large loans are covenant free, while less than 5% of middle market loans are cov-lite as of 1Q23. Lastly, on the bottom right we show the default rates for private credit and leveraged loans. Default rates for both spiked around mid 2020 before falling, as the economic reopening improved credit quality. However, both have started to pick up in recent quarters, as monetary tightening and above average inflation weigh on credit quality.