Overview of the Rating Change#
S&P Global Ratings has affirmed the 'A' long-term issuer credit rating for the Cliffwater Corporate Lending Fund (CCLF) but has changed its outlook from stable to negative. This adjustment reflects concerns about potential liquidity risks stemming from a significant number of redemption requests from investors.
Redemption Requests on the Rise#
In the first quarter of 2026, CCLF faced substantial redemption requests amounting to 13.95% of its net asset value (NAV), a notable increase from 5.3% in the previous quarter. To address these requests, the fund opted to allow redemptions up to 7% of NAV, exceeding the legal minimum of 5%. As a result, investors can expect to receive about half of their requested redemptions in cash.
Fund Composition and Performance#
CCLF is the largest interval fund in the market, with a NAV of $32 billion as of December 2025. The fund primarily invests two-thirds of its assets in senior loans to middle-market companies in the U.S., while the remaining third is allocated to private managed vehicles and stakes in private credit funds and business development companies. Despite the increase in redemption requests, S&P maintains that the fund has good asset quality and low leverage compared to its peers.
Liquidity and Borrowing Capacity#
S&P's affirmation of the 'A' rating is supported by CCLF's satisfactory liquidity position. The fund's nonaccrual loan rate remains low, and its leverage ratio was 0.23x debt to NAV at the end of February, increasing slightly to 0.3x after utilizing its corporate revolver to meet redemptions. CCLF has significant borrowing capacity, including a recently increased corporate revolver of $4.66 billion and additional financing options, ensuring it can manage its liquidity needs without facing immediate pressures from lenders.