Monitor portfolio · PCT-035 · Sourced card
Test facility concentration limits
A lender to a BDC has just added a 20% 'broad software' concentration limit and cut the advance rate on recurring-revenue loans.
Today vs automated
- Read the facilityAnalyst · manual
- Re-map loans to its sectorsAnalyst · manual
- Rebuild the borrowing basePM · manual
- Email / meeting hand-offAnalyst → PM
- The lender sends amended concentration limitsTrigger: starts on its own
- Extract eligibility rulesAutomated · Document store
- Map every loanAutomated · LLM
- Show headroom old vs newAI draft, human review · Monitoring model
- Industry classification calls and whether to negotiateApprove / override · PM
AutomatedAI draft, human reviewHuman onlyTools: Inbox / portal, Document store, LLM, Monitoring model, Loan system
Estimated valueestimate
30–390 analyst hours a year
$4k–$98k of time, vs an assumed $10k–$40k tool cost
Net: −$36k to $88k a year net of tool cost; at the low end of the assumptions it does not cover the tool cost.
Assumptions
- 4–8 analyst hours per test run today; 0.5–1.5 hours with an agent, including review
- 12–52 test runs a year for one team
- $150–250 per hour loaded cost
- Tool or build cost $10,000–40,000 a year (in-house)
Estimate, based on the assumptions shown; your numbers will differ. How we estimate
What else it can do for the team
- Test a new loan's effect before closing
- Draft the borrowing base for the lender
- Flag ineligible loans and why
- Compare terms across facilities
- Prepare for facility renegotiation
How you get thereFour steps from prompting to an agentic workflow; most teams start at step 2.
Needs: an approved AI tool, a confidentiality policy.
Risk: unchecked answers, data pasted outside policy.
Needs: field definitions, a template, document parsing.
Risk: breaks silently when formats change.
Typical starting point
Needs: inbox/doc-store access, system write-back, logging.
Risk: acting on a misread; needs review gates.
The automated lane above
Needs: shared data model, permissions, audit trail, exception queue.
Risk: errors compound across steps; needs monitoring.
Solution optionsBuy (7 vendors listed), build or hybrid, with the trade-offs of each.
Lumonic, Allvue, Cardo AI, dv01, Intain, Oxane Partners, Setpoint
Fastest start; you adapt to the product's data model and pricing.
An LLM API, a document parser, a vector or document store, your data warehouse, and a review queue.
Fits your definitions exactly; you own maintenance and controls.
Vendor extraction feeding your own checks, templates and systems.
Common middle path; two things to integrate and govern.
Listing is not endorsement.
What changes for the team4–8 h → 0.5–1.5 h per test run (estimate); coverage goes from a sample of borrowers, quarterly to every borrower, every delivery.
How it works
Full title: Will the new concentration limit bite? Test your portfolio against your back-leverage facility's eligibility limits
“A 20% cap on 'broad software' and a 50% advance rate on ARR loans. Here's the clause, and how to test your book against it.”
Scenario
Public: a lender to a BDC has just added a 20% 'broad software' concentration limit and cut the advance rate on recurring-revenue loans. The fund wants to know the borrowing-base impact before the next draw.
What the human still decides
Industry classification calls and whether to negotiate. Definitions are contractual; treasury and counsel own them.
Why it matters
On 1 Oct 2026, lenders to First Eagle Private Credit Fund capped software, IT services and healthcare tech at 20% of collateral and cut the advance rate on recurring-revenue loans to 50% from 60%. Expect other facilities to follow.
What the record shows
Checked 2026-10-15.
First Eagle's non-traded BDC $350m facility (Morgan Stanley Bank $250m + Western Alliance Bank $100m; Morgan Stanley Senior Funding admin agent) was amended effective 1 Oct 2026 (8-K filed 5 Oct, accession 0001193125-26-414009) to cap Broad Software (Software, Health Care Technology, IT Services) at 20.0% of the Concentration Denominator (eligible collateral), not the borrowing base, and cut the recurring-revenue advance rate to 50% from 60%, with the revolving margin down 30bp to 2.25%. Test your tagging against the facility's industry definitions before your lender does.
Try it: prompt and data
From this credit facility agreement and its amendments, extract every eligibility criterion, concentration limit and advance rate with section cites. Then, for the attached SAMPLE portfolio, compute the borrowing base before and after the latest amendment and list loans whose classification is ambiguous.
Data
Public inputs only (SEC/EDGAR filings, published methodologies, public signals). Every figure is cited.
Who uses it, vendors and build
- Segments
- BDCs, Fund finance
- Who uses it
- CFO / fund finance, Portfolio manager, Treasury
- Build
- Buildable in-house
- In-house
- Clause extraction plus a borrowing-base calculator. Estimate: 2 weeks; needs treasury sign-off on classifications.
- Last verified
- 2026-10-15
Vendors that claim this capability
- Oxane Partners: borrowing-base, fund-finance-facilities
- Allvue: fund-finance-facilities
- Cardo AI: fund-finance-facilities
- dv01: borrowing-base
- Intain: borrowing-base
- 2 more vendors claim related capabilities. See all vendors for this stage →
Tags reflect each vendor's own public claims at the linked page (checked 2026-10-15). Not tested, ranked or endorsed.
Sources and related
- SEC 8-K / Ex 10.1: First Eagle Private Credit Fund Fourth Amendment (filed 5 Oct 2026)
- Alternative Credit Investor: BlackRock on software markdowns (9 Oct 2026)
- 26North BDC's JPMorgan facility amendment caps recurring-revenue loans at 15% and resets the advance rate to 55%
- StepStone Private Credit Fund upsizes its Wells Fargo SPV III facility to $1.0bn and cuts the margin to 1.95%
- Facility lenders cap 'broad software' at 20.0% of Concentration Denominator for First Eagle's non-traded BDC
Next step
Get new walk-throughs
Not investment advice. Names marked SAMPLE are fictional. Found an error? See the corrections log.