Alpha Buying: What Insiders Are Buying in Private Credit Right Now — And Why It Matters

As private credit continues to gain traction in institutional portfolios and the public markets, a growing number of income investors are looking to Business Development Companies (BDCs) as a way to capture the asset class's high yields and defensive characteristics. With floating-rate loans still generating strong returns and traditional lenders like regional banks retrenching, BDCs are in a favorable position, at least for now.

But not all BDCs are created equal. While headline yields across the space routinely exceed 11%, there's a wide divergence in underwriting quality, portfolio construction, and resilience to rising credit stress. In that environment, insider buying, executives and directors purchasing shares in their own firms, is emerging as one of the clearest signals of durability and long-term value.

In recent months, three BDCs, Nuveen Churchill Direct Lending Corp. (NCDL), Barings BDC (BBDC), and Oaktree Specialty Lending (OCSL), have all seen a marked uptick in insider purchases. That activity comes at a time when investors are beginning to scrutinize the sustainability of dividend payouts, the quality of underlying loans, and the potential effects of an eventual decline in interest rates.

Private credit has been one of the fastest-growing segments of the asset management industry over the past five years, and 2024 was a watershed moment. With the Federal Reserve holding short-term interest rates at their highest level in over two decades and bank lenders pulling back from middle-market and sponsor-backed deals, private credit managers filled the void. BDCs, particularly those with scale, institutional backing, and origination capabilities, saw a sharp increase in loan volume, deal pricing power, and interest income.

The result has been a banner stretch for BDC earnings. Floating-rate loans have re-priced higher, funding costs have remained relatively contained, and net investment income (NII) has surged across the sector. Dividend coverage ratios remain solid for most public BDCs, and NAVs have been largely stable, especially for those with senior-heavy portfolios.

But there are signs of transition ahead. Loan demand remains strong, but underwriting standards are tightening. Many portfolio companies that borrowed aggressively in 2021–2022 are facing refinancing at significantly higher rates. Interest coverage ratios are declining, and default risk, while still low by historical standards, is rising. Credit quality is becoming more important than ever, and the next phase of returns will likely come from disciplined loan structuring, not just rising base rates.

Add to this the growing expectation that the Fed may begin easing monetary policy in late 2025, and the picture becomes more nuanced. As floating-rate income begins to normalize, BDCs that relied solely on rate-driven earnings growth may struggle to maintain dividends. Those with resilient portfolios, sticky deal flow, and strong alignment between management and shareholders are better positioned to navigate what comes next.

In this shifting environment, insider behavior can offer rare clarity. Unlike analysts or outside investors, insiders have direct visibility into loan performance, borrower conversations, and credit pipeline dynamics. When they buy stock with personal capital, it often reflects a deeper confidence in the underlying value and the firm's ability to deliver returns in a more challenging market.

That's what makes the recent activity at NCDL, BBDC, and OCSL worth noting.

Nuveen Churchill Direct Lending Corp. NCDL

Launched as a public vehicle by institutional powerhouse Nuveen, NCDL represents the public-facing arm of the Churchill Asset Management platform. With a focus on first-lien, directly originated loans to upper middle-market companies, many backed by private equity sponsors, NCDL brings conservative credit underwriting to the public BDC arena.

Since March, several executives have stepped in to purchase shares as the stock traded modestly below net asset value. At current levels, NCDL yields more than 12%, a level that reflects both the strength of its floating-rate loan book and a market discount that insiders appear eager to close. The firm's backing by TIAA adds further stability and credibility in a sector where investor trust is paramount.

Barings BDC BBDC

BBDC is managed by Barings LLC, one of the largest global credit investment firms, and benefits from its deep origination networks, risk management infrastructure, and deal access. The portfolio remains tilted toward first-lien secured loans, with significant exposure to diversified sectors and a history of prudent leverage.

In April and May, as BBDC's share price drifted to a roughly 10% discount to NAV, insider buying picked up considerably. Directors and executives stepped in with open-market purchases, a clear sign they viewed the selloff as disconnected from the company's fundamentals. With a current dividend yield above 11% and stable credit metrics, BBDC offers both income and alignment—a rare combination in a volatile rate environment.

Oaktree Specialty Lending OCSL

OCSL may be one of the more underappreciated BDCs in the public market, but it brings a critical pedigree: the backing of Oaktree Capital Management, a firm with decades of experience in distressed debt and opportunistic credit. That DNA is evident in OCSL's portfolio construction, which has consistently emphasized sponsor-backed, senior-secured loans with robust covenants and limited exposure to cyclical tail risk.

OCSL trades just under book value and yields nearly 12%, but perhaps more importantly, insiders have been steadily accumulating shares over the past two quarters. In a credit environment where risk and underwriting discipline are paramount, Oaktree's approach—and its management's willingness to buy into their own vehicle—offers a compelling case for long-term investors.

The private credit boom has created opportunity—but also heightened risk. With so many public and private vehicles now competing for middle-market loans, underwriting standards and pricing discipline will determine who outperforms in the next chapter of the cycle.

For investors, that means going beyond yield screens and paying attention to alignment. Insider buying, in particular, offers a rare window into the confidence of management teams that see the portfolio data daily. In BDCs \,where transparency is limited and credit risk is often opaque there are few clearer signals.

In the cases of NCDL, BBDC, and OCSL, that signal is flashing. And in a maturing credit cycle, it may prove to be one of the most important ones to follow.