LevFin Insights | Holidays to Headwinds: Private Credit Stress Signals
Originally published by CreditSights Podcasts on December 9, 2025.
Rising stress indicators in Europe’s private credit market have widespread implications for both lending competition and mergers and acquisitions in 2026. Nick Baldwin, Managing Director in Lincoln International’s Valuations & Opinions Group, recently shared his insights on the LevFin Insights Levered Lines Podcast.
The discussion explores troublesome trends after covenant default rates reached 3.9% in Q3 2025. A surge in covenant holidays and the doubling of companies with less than 10% covenant headroom both point to increasing stress, compounded by factors in the technology and consumer sectors. Nick’s insights have crucial takeaways for private credit investors and lenders navigating today’s evolving market dynamics.
Summary
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Lincoln International’s private credit experts explore private credit stress signals, including covenant trends and spread compression.
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