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Investments (Tables)

12 Months Ended

Dec. 31, 2023

Schedule of Investments [Abstract]

Schedule of Investments

Summaries of the composition of the Company’s investment portfolio at cost and fair value, and as a percentage of total investments and net assets, are shown in the following tables: 

($ in thousands)						Cost						Percent of Total Portfolio						Fair Value						Percent of Total Portfolio						Percent of Total Net Assets
December 31, 2023:
Senior debt and 1st lien notes						$	1,705,353					67		%				$	1,670,300					67		%				140		%
Subordinated debt and 2nd lien notes						256,850						10						238,215						10						20
Structured products						107,314						4						93,038						4						8
Equity shares						320,335						13						374,704						15						31
Equity warrants						76						—						2,392						—						—
Investments in joint ventures / PE fund						145,648						6						110,066						4						9
						$	2,535,576					100		%				$	2,488,715					100		%				208		%
December 31, 2022:
Senior debt and 1st lien notes						$	1,752,943					69		%				$	1,696,192					69		%				142		%
Subordinated debt and 2nd lien notes						326,639						13						263,139						11						22
Structured products						88,805						3						73,550						3						6
Equity shares						230,188						9						284,570						12						24
Equity warrants						178						—						1,057						—						—
Investments in joint ventures / PE fund						163,645						6						130,427						5						11
						$	2,562,398					100		%				$	2,448,935					100		%				205		%

The industry composition of investments at fair value at December 31, 2023 and December 31, 2022 was as follows:

($ in thousands)			December 31, 2023			Percent of Portfolio			Percent of Total Net Assets						December 31, 2022			Percent of Portfolio			Percent of Total Net Assets
Aerospace and Defense			$	132,498		5.3		%	11.1		%				$	120,945		4.9		%	10.1		%
Automotive			80,828			3.3			6.7						76,934			3.2			6.5
Banking, Finance, Insurance and Real Estate			401,816			16.1			33.6						312,936			12.8			26.2
Beverage, Food and Tobacco			23,135			0.9			1.9						34,690			1.4			2.9
Capital Equipment			128,706			5.2			10.8						141,479			5.8			11.9
Chemicals, Plastics, and Rubber			35,897			1.5			3.0						47,076			1.9			3.9
Construction and Building			30,387			1.2			2.5						45,049			1.8			3.8
Consumer goods: Durable			47,074			1.9			3.9						43,932			1.8			3.7
Consumer goods: Non-durable			28,210			1.1			2.4						27,693			1.1			2.3
Containers, Packaging and Glass			37,524			1.5			3.1						37,877			1.5			3.2
Energy: Electricity			20,874			0.8			1.7						7,337			0.3			0.6
Energy: Oil and Gas			3,240			0.1			0.3						4,776			0.2			0.4
Environmental Industries			53,484			2.1			4.5						51,006			2.1			4.3
Healthcare and Pharmaceuticals			216,952			8.7			18.1						203,576			8.3			17.1
High Tech Industries			303,082			12.2			25.4						300,980			12.3			25.2
Hotel, Gaming and Leisure			54,256			2.2			4.5						54,023			2.2			4.5
Investment Funds and Vehicles			110,066			4.4			9.2						130,427			5.3			10.9
Media: Advertising, Printing and Publishing			39,447			1.6			3.3						55,477			2.3			4.7
Media: Broadcasting and Subscription			13,277			0.5			1.1						20,257			0.8			1.7
Media: Diversified and Production			64,559			2.6			5.4						60,561			2.5			5.1
Metals and Mining			8,993			0.4			0.8						33,125			1.4			2.8
Services: Business			326,762			13.2			27.3						338,417			13.8			28.4
Services: Consumer			61,409			2.5			5.1						67,070			2.7			5.6
Structured Products			102,922			4.1			8.6						86,703			3.5			7.3
Telecommunications			27,565			1.1			2.3						24,058			1.0			2.0
Transportation: Cargo			96,450			3.9			8.1						89,398			3.7			7.5
Transportation: Consumer			11,951			0.5			1.0						11,062			0.5			0.9
Utilities: Electric			22,696			0.9			1.9						17,374			0.7			1.5
Utilities: Oil and Gas			4,655			0.2			0.4						4,697			0.2			0.4
Total			$	2,488,715		100.0		%	208.0		%				$	2,448,935		100.0		%	205.4		%

As of December 31, 2023 and December 31, 2022, the Jocassee investment portfolio consisted of the following investments:

($ in thousands)			Cost						Percentage of Total Portfolio						Fair Value						Percentage of Total Portfolio
December 31, 2023:
Senior debt and 1st lien notes			$	1,284,098					93		%				$	1,260,183					95		%
Subordinated debt and 2nd lien notes			21,728						2						21,262						2
Equity shares			449						—						268						—
Equity warrants			—						—						467						—
Investment in joint ventures			54,563						4						33,450						2
Short-term investments			14,896						1						14,896						1
			$	1,375,734					100		%				$	1,330,526					100		%
December 31, 2022:
Senior debt and 1st lien notes			$	1,177,895					91		%				$	1,123,760					92		%
Subordinated debt and 2nd lien notes			23,141						2						21,659						2
Equity shares			8,521						—						2,458						—
Equity warrants			31						—						158						—
Investment in joint ventures			75,941						6						61,028						5
Short-term investments			10,826						1						10,826						1
			$	1,296,355					100		%				$	1,219,889					100		%

The industry composition of Jocassee’s investments at fair value at December 31, 2023 and December 31, 2022, excluding short-term investments, was as follows:

($ in thousands)			December 31, 2023												December 31, 2022
Aerospace and Defense			$	82,200					6.3		%				$	69,133					5.7		%
Automotive			26,087						2.0						20,625						1.7
Banking, Finance, Insurance and Real Estate			121,798						9.3						105,047						8.7
Beverage, Food and Tobacco			30,637						2.3						25,885						2.1
Capital Equipment			17,986						1.4						25,014						2.1
Chemicals, Plastics, and Rubber			37,030						2.8						33,111						2.7
Construction and Building			16,942						1.3						17,616						1.5
Consumer goods: Durable			26,412						2.0						18,751						1.7
Consumer goods: Non-durable			21,850						1.7						22,861						1.9
Containers, Packaging and Glass			26,829						2.0						24,445						2.0
Energy: Electricity			20,250						1.5						15,375						1.3
Energy: Oil and Gas			6,724						0.5						5,726						0.5
Environmental Industries			6,986						0.5						7,314						0.6
Forest Products & Paper			3,605						0.3						2,269						0.2
Healthcare and Pharmaceuticals			141,070						10.7						128,983						10.7
High Tech Industries			174,572						13.3						141,906						11.7
Hotel, Gaming and Leisure			22,834						1.7						23,587						2.0
Investment Funds and Vehicles			33,450						2.5						61,028						5.0
Media: Advertising, Printing and Publishing			12,081						0.9						5,969						0.5
Media: Broadcasting and Subscription			31,201						2.4						34,676						2.9
Media: Diversified and Production			34,391						2.6						28,897						2.4
Metals and Mining			3,863						0.3						5,069						0.4
Retail			13,141						1.0						15,720						1.3
Services: Business			222,610						16.9						199,805						16.5
Services: Consumer			58,632						4.5						52,543						4.3
Telecommunications			36,027						2.7						38,034						3.1
Transportation: Cargo			57,575						4.4						56,018						4.6
Transportation: Consumer			12,613						1.0						12,562						1.0
Utilities: Electric			9,396						0.7						4,194						0.3
Utilities: Oil and Gas			6,838						0.5						6,900						0.6
Total			$	1,315,630					100.0		%				$	1,209,063					100.0		%

Schedule of Fair Value, Assets Measured on Recurring Basis

The following table presents the Company’s investment portfolio at fair value as of December 31, 2023 and 2022, categorized by the ASC Topic 820 valuation hierarchy, as previously described:

			Fair Value at December 31, 2023
($ in thousands)			Level 1						Level 2						Level 3						Total
Senior debt and 1st lien notes			$	—					$	76,503					$	1,593,797					$	1,670,300
Subordinated debt and 2nd lien notes			—						14,417						223,798						238,215
Structured products			—						50,066						42,972						93,038
Equity shares			132						—						374,572						374,704
Equity warrants			—						—						2,392						2,392
Investments subject to leveling			$	132					$	140,986					$	2,237,531					$	2,378,649
Investments in joint ventures / PE fund(1)																					110,066
																					$	2,488,715
			Fair Value at December 31, 2022
($ in thousands)			Level 1						Level 2						Level 3						Total
Senior debt and 1st lien notes			$	—					$	104,836					$	1,591,356					$	1,696,192
Subordinated debt and 2nd lien notes			—						28,925						234,214						263,139
Structured products			—						55,723						17,827						73,550
Equity shares			164						1,339						283,067						284,570
Equity warrants			—						—						1,057						1,057
Investments subject to leveling			$	164					$	190,823					$	2,127,521					$	2,318,508
Investments in joint ventures / PE fund(1)																					130,427
																					$	2,448,935

(1)The Company’s investments in Jocassee, Sierra JV, Thompson Rivers, Waccamaw River and the MVC Private Equity Fund LP (each as defined below) are measured at fair value using NAV and have not been categorized in the fair value hierarchy. The fair value amount presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the Consolidated Balance Sheets.

Schedule of Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation

The following tables reconcile the beginning and ending balances of the Company’s investment portfolio measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the years ended December 31, 2023 and 2022:

Year Ended December 31, 2023: ($ in thousands)			Senior Debt and 1st Lien Notes						Subordinated Debt and 2nd Lien Notes						Structured Products						Equity Shares						Equity Warrants												Total
Fair value, beginning of period			$	1,591,356					$	234,214					$	17,827					$	283,067					$	1,057											$	2,127,521
New investments			396,040						49,525						28,286						94,595						—												568,446
Transfers into (out of) Level 3, net			(15,843)						16,815						—						914						—												1,886
Proceeds from sales of investments			(246,902)						(2,800)						(526)						(8,977)						—												(259,205)
Loan origination fees received			(8,173)						(113)						—						—						—												(8,286)
Principal repayments received			(151,817)						(83,986)						(1,018)						—						—												(236,821)
Payment-in-kind interest/dividends			6,757						9,877						—						8,677						—												25,311
Accretion of loan premium/discount			668						916						—						—						—												1,584
Accretion of deferred loan origination revenue			7,420						702						—						—						—												8,122
Realized gain (loss)			(1,746)						(43,902)						—						(590)						(102)												(46,340)
Unrealized appreciation (depreciation)			16,037						42,550						(1,597)						(3,114)						1,437												55,313
Fair value, end of period			$	1,593,797					$	223,798					$	42,972					$	374,572					$	2,392											$	2,237,531

Year Ended December 31, 2022: ($ in thousands)			Senior Debt and 1st Lien Notes						Subordinated Debt and 2nd Lien Notes						Structured Products						Equity Shares												Equity Warrants						Total
Fair value, beginning of period			$	1,137,323					$	230,569					$	—					$	151,282											$	864					$	1,520,038
New investments			907,398						95,157						14,893						71,576												4						1,089,028
Investments acquired in Sierra Merger			210,176						54,177						—						7,065												72						271,490
Transfers into (out of) Level 3, net			43						(11,848)						4,905						7,263												41						404
Proceeds from sales of investments			(323,831)						(21,555)						—						(7,304)												(250)						(352,940)
Loan origination fees received			(18,803)						(1,317)						—						—												—						(20,120)
Principal repayments received			(270,795)						(77,293)						(357)						—												—						(348,445)
Payment-in-kind interest/dividends			2,996						11,330						—						1,677												—						16,003
Accretion of loan premium/discount			790						89						—						—												—						879
Accretion of deferred loan origination revenue			8,338						2,734						—						—												—						11,072
Realized gain (loss)			(13,163)						(2,781)						—						1,096												(760)						(15,608)
Unrealized appreciation (depreciation)			(49,116)						(45,048)						(1,614)						50,412												1,086						(44,280)
Fair value, end of period			$	1,591,356					$	234,214					$	17,827					$	283,067											$	1,057					$	2,127,521

Schedule of Investment Portfolio

The geographic composition of Jocassee’s investments at fair value at December 31, 2023 and December 31, 2022, excluding short-term investments, was as follows:

			December 31, 2023												December 31, 2022
Australia			$	26,291					2.0		%				$	26,111					2.1		%
Austria			6,026						0.5		%				6,697						0.5
Belgium			20,379						1.5						16,385						1.4
Canada			3,998						0.3						7,280						0.6
Denmark			1,082						0.1						953						0.1
Finland			2,207						0.2						1,967						0.2
France			137,072						10.4						133,682						11.1
Germany			50,672						3.9						38,068						3.1
Hong Kong			14,162						1.1						16,593						1.4
Ireland			7,445						0.6						4,334						0.4
Luxembourg			1,839						0.1						1,759						0.1
Netherlands			41,260						3.1						35,194						2.9
Panama			1,466						0.1						945						0.1
Singapore			4,980						0.4						4,955						0.4
Spain			4,777						0.4						4,189						0.3
Sweden			4,519						0.3						4,371						0.4
Switzerland			592						—						5,558						0.5
United Kingdom			120,398						9.2						126,305						10.4
USA			866,465						65.8						773,717						64.0
Total			$	1,315,630					100.0		%				$	1,209,063					100.0		%

As of December 31, 2023 and December 31, 2022, Jocassee had the following contributed capital and unfunded commitments from its members:

($ in thousands)						As of December 31, 2023						As of December 31, 2022
Total contributed capital by Barings BDC, Inc.						$	35,000					$	35,000
Total contributed capital by all members						$	385,000					$	385,000
Total unfunded commitments by Barings BDC, Inc.						$	65,000					$	65,000
Total unfunded commitments by all members						$	215,000					$	215,000

As of December 31, 2023 and December 31, 2022, the Thompson Rivers investment portfolio consisted of the following investments:

($ in thousands)			Cost						Percentage of Total Portfolio						Fair Value						Percentage of Total Portfolio
December 31, 2023:
Federal Housing Administration (“FHA”) loans			$	360,847					93		%				$	342,240					93		%
Veterans Affairs (“VA”) loans			25,810						7		%				24,491						7		%
			$	386,657					100		%				$	366,731					100		%
December 31, 2022:
Federal Housing Administration (“FHA”) loans			$	864,625					91		%				$	811,358					91		%
Veterans Affairs (“VA”) loans			84,654						9		%				79,553						9		%
			$	949,279					100		%				$	890,911					100		%

As of December 31, 2023 and December 31, 2022, Thompson Rivers had the following contributed capital and unfunded commitments from its members:

($ in thousands)						As of December 31, 2023						As of December 31, 2022
Total contributed capital by Barings BDC, Inc. (1)						$	79,411					$	79,411
Total contributed capital by all members (2)						$	482,083					$	482,083
Total unfunded commitments by Barings BDC, Inc.						$	—					$	—
Total unfunded commitments by all members						$	—					$	—

(1)Includes $4.4 million of dividend re-investments.

(2)Includes dividend re-investments of $32.1 million and $162.1 million of total contributed capital by related parties.

As of December 31, 2023 and December 31, 2022, Waccamaw River had the following contributed capital and unfunded commitments from its members:

($ in thousands)						As of December 31, 2023						As of December 31, 2022
Total contributed capital by Barings BDC, Inc.						$	30,280					$	27,800
Total contributed capital by all members (1)						$	139,020					$	126,620
Total return of capital (recallable) by Barings BDC, Inc.						$	—					$	(5,280)
Total return of capital (recallable) by all members						$	—					$	(14,020)		(2)
Total unfunded commitments by Barings BDC, Inc.						$	—					$	2,480
Total unfunded commitments by all members						$	—					$	12,400		(3)

(1)Includes $82.0 million and $74.6 million of total contributed capital by related parties as of December 31, 2023 and December 31, 2022, respectively.

(2)Includes ($7.0) million of total return of capital (recallable) by related parties.

(3)Includes $7.4 million of unfunded commitments by related parties.

As of December 31, 2023 and December 31, 2022, the Sierra JV investment portfolio consisted of the following investments:

($ in thousands)			Cost						Percentage of Total Portfolio						Fair Value						Percentage of Total Portfolio
December 31, 2023:
Senior debt and 1st lien notes			$	85,304					100		%				$	79,599					100		%
			$	85,304					100		%				$	79,599					100		%
December 31, 2022:
Senior debt and 1st lien notes			$	125,220					100		%				$	110,047					100		%
			$	125,220					100		%				$	110,047					100		%

The industry composition of Sierra JV’s investments at fair value at December 31, 2023 and December 31, 2022 was as follows:

($ in thousands)			December 31, 2023												December 31, 2022
Automotive			$	2,463					3.1		%				$	2,283					2.1		%
Banking, Finance, Insurance and Real Estate			254						0.3						1,414						1.3
Beverage, Food and Tobacco			3,172						4.0						3,181						2.9
Capital Equipment			5,271						6.6						9,208						8.4
Chemicals, Plastics, and Rubber			2,942						3.7						2,772						2.5
Construction and Building			1,867						2.4						1,887						1.7
Consumer goods: Durable			1,042						1.3						1,272						1.1
Containers, Packaging and Glass			—						—						1,812						1.6
Environmental Industries			3,487						4.4						7,797						7.1
Healthcare and Pharmaceuticals			12,880						16.2						13,614						12.4
High Tech Industries			14,661						18.4						13,713						12.5
Media: Advertising, Printing and Publishing			—						—						10,032						9.1
Media: Diversified and Production			—						—						5,498						5.0
Retail			6,255						7.9						5,489						5.0
Services: Business			6,798						8.5						10,876						9.9
Services: Consumer			8,525						10.7						8,265						7.5
Transportation: Cargo			6,296						7.9						6,221						5.6
Transportation: Consumer			3,686						4.6						4,713						4.3
Total			$	79,599					100.0		%				$	110,047					100.0		%

X

- Definition

Tabular disclosure of assets, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, by class that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3).

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482106/820-10-50-2

Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482106/820-10-50-2

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X

- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (c)
-SubTopic 10
-Topic 820
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482106/820-10-50-2

Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 3
-Publisher FASB
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Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
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