Blackstone Private Credit Fund (BCRED)

What BCRED is

• Structure: Delaware statutory trust; externally managed, non-diversified, closed-end management investment company. Regulated as a business development company (BDC) under the Investment Company Act of 1940 (the 1940 Act). Elects to be treated as a regulated investment company (RIC) for U.S. federal tax purposes.
• Management and administration:
  • Adviser: Blackstone Private Credit Strategies LLC (the “Adviser”)
  • Sub‑Adviser: Blackstone Credit BDC Advisors LLC (the “Sub‑Adviser”)
  • Administrator: Blackstone Private Credit Strategies LLC
  • Sub‑Administrator: Blackstone Alternative Credit Advisors LP; State Street Bank and Trust Company serves as the State Street Sub‑Administrator
  • No BCRED employees; day‑to‑day investment operations are conducted by the Adviser, Sub‑Adviser and their affiliates
• Offices: Principal offices at 345 Park Avenue, New York, NY 10154 (same as Adviser/Administrators)

Investment objectives and focus

• Primary objective: Generate current income; secondary objective: long‑term capital appreciation.
• Investment policy (under normal circumstances):
  • At least 80% of total assets invested in private credit investments (loans, bonds, and other credit instruments issued in private offerings or by private companies).
  • Major private credit types: first‑lien senior secured and unitranche loans (including first‑out/last‑out structures, typically < $300 million), second‑lien, unsecured, subordinated or mezzanine loans; structured credit (including CLOs); club deals and other debt/equity securities.
  • May retain the “last out” portion of a first‑lien loan in limited instances.
  • May invest to a lesser extent in publicly traded large‑cap issuers.
  • May invest in collateralized loan obligations (CLOs) with the right to receive payments from CLOs rather than directly against underlying borrowers/sponsors.
  • May enter into derivatives for hedging; hedges for speculative purposes are not expected to be material.
• Geographic and issuer scope: Primarily U.S. private companies; may invest in European and other non‑U.S. companies but not in emerging markets. Up to 30% non‑qualifying investments allowed.

Scale and portfolio (as of December 31, 2025)

• Fair value of investments: $82.2 billion across approximately 700 portfolio companies.
• Allocation by asset type (portfolio at fair value):
  • First lien debt: 89.2%
  • Second lien debt: 4.0%
  • Unsecured debt: 0.1%
  • Structured finance obligations (debt): 0.6%
  • Structured finance obligations (equity): 0.4%
  • Investments in joint ventures: 2.2%
  • Equity and other: 3.5%
• Undrawn/unfunded commitments: $13.4 billion aggregate (including delayed draw term loans and revolvers).
• Concentration: At times the portfolio has included a meaningful allocation to the software industry (over 25% of total investments at fair value), alongside diversification across other sectors.

Capital structure and liquidity

• Asset coverage: 235.7% as of 12/31/2025 (150% minimum requirement for leverage and senior securities under the 1940 Act).
• Leverage: May borrow up to 2:1 debt‑to‑equity under the 1940 Act; securitizations and other forms of leverage may be used in addition to traditional borrowings.
• Continuous offering: Offering up to $45.0 billion of Common Shares on a continuous basis, across three share classes (Class I, Class S, Class D). Initial primary offering price was $25.00 per share; thereafter, purchase price equals NAV per share as of the effective date of the monthly share purchase date.
• Share repurchase program: Up to 5% of the NAV of Common Shares outstanding may be repurchased each quarter, subject to Board discretion and certain conditions (Board may suspend or amend the program).
• Distributions: Monthly distributions; Board has discretion to adjust distributions. To maintain RIC status, annual distributions are generally at least 90% of investment company taxable income plus net tax‑exempt income.
• Share classes and fees:
  • Class I: No upfront selling commissions; no ongoing shareholder servicing/distribution fee.
  • Class S: Up to 0.85% annual shareholder servicing and/or distribution fee (on NAV), paid monthly; brokers receive a portion through reallowance.
  • Class D: Up to 0.25% annual shareholder servicing and/or distribution fee (on NAV), paid monthly; brokers receive a portion through reallowance.
• Distribution reinvestment plan: Cash distributions are automatically reinvested in additional shares for participating shareholders unless they opt out.

Advisory, administration, and related fees

• Adviser management fee: 1.25% per year of the value of net assets, payable monthly and settled quarterly in arrears.
• Incentive fees (both payable in arrears):
  • Income‑based incentive fee: Based on Pre‑Incentive Fee Net Investment Income Returns (PI‑NII Returns) with a hurdle rate of 1.25% per quarter (5.0% annualized). If PI‑NII Returns exceed 1.25% but are below 5.72% annualized (1.43% quarterly), a catch‑up provision allows the Adviser to receive 12.5% of the excess; once the hurdle and catch‑up are achieved, 12.5% of PI‑NII Returns above the hurdle are paid as the incentive.
  • Capital gains incentive fee: 12.5% of cumulative realized capital gains since inception, net of prior paid capital gains incentive fees; accrues on unrealized gains but payable only upon realization.
• Administration/sub‑administration fees: Administrators are reimbursed for costs and personnel; Sub‑Administrator costs are reimbursed by the Administrator; certain expense reimbursements may be allocated to the Company.

Operational and governance context

• Board: Seven trustees; five are independent (not “interested persons” under the 1940 Act).
• Conflicts of interest: The Adviser and its affiliates manage multiple client accounts. Allocation of investment opportunities, co‑investments, and related allocations are subject to applicable law and Blackstone’s conflict‑management policies, including a co‑investment relief regime under SEC relief.
• Personnel: All investment and administrative personnel are employees of the Adviser, Sub‑Adviser or Administrators; BCRED itself has no dedicated employees.

Additional context on risk and structure

• Use of leverage: BCRED uses leverage within statutory limits and maintains substantial liquidity and credit facilities; regulatory asset coverage is a key constraint.
• Portfolio composition: Investments include secured, unsecured, junior/subordinated, structured products, and CLOs; many assets are illiquid or privately negotiated.
• Due diligence and value creation: The Advisers conduct credit analysis, on‑site visits, and integrate with Blackstone’s platform (Value Creation Program) to support deal flow and operational value.
• Co‑investments and joint ventures: The Company may invest in joint ventures and may syndicate co‑investments, which introduce additional complexity and risk.
• Derivatives and hedging: The Fund employs hedging and derivative strategies (including TRS, credit default swaps, securitizations) that introduce leverage and counterparty risk.
• Governance and compliance: Management oversight, governance, and compliance programs are used to manage conflicts of interest across Blackstone’s broader investment platform.