KBRA Affirms BBB- Rating for MSC Income Fund, Inc. with Stable Outlook

The Kroll Bond Rating Agency (KBRA) has reaffirmed the BBB- issuer and senior unsecured debt ratings for MSC Income Fund, Inc. (MSIF) with a stable outlook. KBRA's decision is supported by MSIF's diversified investment portfolio, which is spread across 153 portfolio companies in over 30 industries, with a significant exposure to private loan investments. The company has also maintained a low leverage ratio of 0.75x due to its more restrictive regulatory minimum asset coverage, which will decrease to 150% in January 2026.

Key Takeaways:

MSIF's investment portfolio is highly diversified, with a $1.2 billion spread across 153 portfolio companies in over 30 industries as of 2Q25.
The company has shifted its portfolio to more exposure to private loan investments, which are typically slightly larger, and to companies owned/being acquired by a private equity fund.
MSIF maintains SEC exemptive relief to co-invest with Main Street Capital Corp. (NYSE: MAIN), the owner of MSIF's adviser, and MAIN's affiliates with 100% of the investment portfolio overlapped with MAIN as of 2Q25.
The company's leverage ratio of 0.75x is low relative to peers due to its more restrictive regulatory minimum asset coverage of 200%, which will decrease to 150% in January 2026.
MSIF's funding profile has become more diversified over time and is comprised of a secured revolving bank facility, an SPV asset facility, and one issue of senior unsecured notes.
The company had adequate liquidity of $156 million in available credit lines and $28.3 million of cash set against $77 million of unfunded commitments and $150 million of near-term debt maturities (October 2026 senior unsecured notes).
The vast majority of non-accruals relate to senior secured first lien loans, likely providing for higher recovery rates.

Statistics:

MSIF's investment portfolio is spread across 153 portfolio companies in over 30 industries as of 2Q25.
The company has a 77% fair value portfolio consisting of senior secured first lien loans.
MSIF's leverage ratio is 0.75x as of 2Q25.
The company's regulatory minimum asset coverage is 200% until January 2026, when it will decrease to 150%.
MSIF's liquidity is $184.3 million as of 2Q25.
The company has $150 million of near-term debt maturities (October 2026 senior unsecured notes).
Non-accruals are 2.6% at fair value and 6.3% at cost as of 2Q25.

Sources:

Kroll Bond Rating Agency, LLC (KBRA)
MSC Income Fund, Inc. (MSIF)
New York Stock Exchange (NYSE)
Securities and Exchange Commission (SEC)
Investment Company Act of 1940
Main Street Capital Corp. (NYSE: MAIN)
Kroll Bond Rating Agency, LLC, [Category: Private Equity and Venture Capital, Asset and Wealth Management, ESG]