Cliffwater Direct Lending Index - 1st Quarter, 2023

Key takeaways from the Q1 2023 Cliffwater Direct Lending Index (CDLI) and market trends are:
1. CDLI produced a strong 2.69% Q1 2023 total return, driven by continued increases in interest income,
2. Realized credit losses equaled -0.25% for Q1, a jump from earlier quarters and roughly equal to the long-term average realized loss rate,
3. CDLI-S, our senior-only index, and CDLI-V, our venture-only index, returned 2.73% and 3.53%, respectively, for Q1 2023, exceeding the broader CDLI return,
4. Aside from the pick-up in realized losses, other measures of loan stress showed only modest changes, and
5. A worsening liquidity environment from reduced M&A activity is noteworthy, as the average effective loan life has continued to increase, reaching 4.94 years on March 31, well above its 3.07-year historical average.