Blue Owl Credit Income Corp.

Blue Owl Credit Income Corp. (OCIC): Institutional-Scale Direct Lending for Individual Investors

Blue Owl Credit Income Corp. (OCIC) is one of the largest non-traded business development companies (BDCs) in the United States. The company provides accredited investors with exposure to a $32 billion portfolio of directly originated, senior secured loans to upper-middle-market companies. The company was previously named Owl Rock Core Income Corp. and Blue Owl Capital’s Blue Owl Credit is the $145.5 billion credit platform to which the company belongs – one of the largest direct lending platforms in the country. Since its inception, the company has raised $18.7 billion of total equity from investors. It offers an annualized distribution rate of around 9.39% for the Class I shares, distributed on a monthly basis. As such, OCIC offers an alternative to K-1 tax reporting investments by allowing income-oriented investors to gain exposure to private credit through its high current income, defensive portfolio characteristics and the institutional nature of the company’s underwriting process.

Investment Strategy

OCIC’s investment strategy is to make defensive, income focused investments in the form of direct loans to U.S. middle and upper-middle-market businesses. The portfolio consists of predominantly floating rate, first-lien, senior secured loans to U.S. middle and upper-middle-market businesses with annual EBITDA generally in the range of $10 million to $250 million. As of June 30, 2025, the portfolio consists of approximately 88.6% senior secured first lien debt, in an effort to achieve capital preservation and downside protection through structural seniority. The fund also seeks to achieve a loan to value ratio of 50% or less and has a general policy of limiting the leverage in any given portfolio company to less than 5% of the total assets of the fund, with investments in 357 portfolio companies across a diverse array of industries including software, insurance, healthcare, business services, food and beverage and many others. The investments are made in conjunction with Blue Owl’s institutional direct lending funds and, as such, the portfolio benefits from 100% alignment of interest with respect to the investment decisions of the portfolio, as well as participation in the same deal flow as Blue Owl’s large institutional client base; the predominantly private equity sponsor-backed nature of the businesses that are borrowers under the notes, which generally results in the portfolio companies having significant amounts of equity in their businesses, as well as increased governance and supervision; and floating rate debt, which provides for increased interest and dividend income as interest rates rise.

• Access to Blue Owl's $145.5 billion credit platform — one of the largest direct lending franchises in the United States, backed by a publicly traded parent (NYSE: OWL) with $284 billion in total AUM
• Highly diversified portfolio of $32 billion in fair value across 357 companies, with no single position generally exceeding 5% of the portfolio
• Predominantly first-lien, senior secured, floating rate loans (88.6% of portfolio) targeting loan-to-value ratios at or below 50%, providing meaningful downside protection
• Exceptionally low historical credit losses with a net annual loss rate of just -0.14% and non-accruals at only 0.2% of investments at cost as of Q2 2025
• Investment grade-rated BBB+ with Stable outlook by KBRA, reflecting the portfolio's credit quality and conservative leverage posture
• Monthly distributions at an annualized rate of approximately 9.39% (Class I), 9.15% (Class D), and 8.56% (Class S), with 1099 tax reporting rather than K-1s
• Accessible minimums starting at $25,000 for Class S and Class D shares, with quarterly liquidity through tender offers of up to 5% of outstanding shares
• Conservative leverage at 0.82x net debt-to-equity with 215% asset coverage — well above the 150% regulatory minimum for BDCs

Fund Structure & Access

OCIC is organized as a perpetually non-traded, closed-end management investment company, categorized as a business development company under the Investment Company Act of 1940. The fund is registered under both the 1933 and 1940 Acts and is considered a regulated investment company (RIC), thereby issuing 1099 tax forms to investors, as opposed to the K-1 tax forms associated with most private credit offerings. The fund has three share classes. The Class S shares have a minimum investment of $25,000, with a maximum front-end sales load of 3.5%, and an annual servicing fee of 0.85%. The Class D shares have a minimum investment requirement of $25,000, with a maximum sales load of 1.5%, and an annual servicing fee of 0.25%. The Class I shares have a minimum investment requirement of $1,000,000 or more for institutional and/or qualified investors. Class S shares will automatically convert to the Class I shares upon the board’s determination that the aggregate fees will exceed 10%. The board calculates and announces the monthly NAV and accepts monthly subscriptions. The quarterly tender offer for shares is at the discretion of the board and the fund generally limits the tender offer to a amount not to exceed 5% of the outstanding shares for each quarter (20% per annum). There is no lock-up period associated with the fund, and there is no early redemption fee, other than the board’s discretion to fully control the tender offer and to suspend or terminate the tender offer program at any time. OCIC is available to accredited investors as defined by the applicable net worth or income suitability standards. Certain states require a higher level of investment for accreditation.

Performance & Track Record

Since its launch in November 2020, the credit performance of OCIC has been one of the strongest among non-traded BDCs. Its historical annual net loss rate of -0.14% is extremely low, especially when considering the dramatic events in the last few years including aggressive interest rate hikes, inflation, and banking instability. Non-accrual rates remain very low at only 0.2% of the investments at cost, as of Q2 2025, due to the prudent underwriting practices by Blue Owl, and the inherently defensive nature of the portfolio. Additionally, OCIC holds a BBB+ (Stable) investment grade rating from KBRA, further reinforcing the high credit quality of the portfolio and its robust structure. Blue Owl’s fee structure for OCIC is competitive to that of many direct lending funds, and we believe is particularly favorable. The 1.25% management fee is levied only on OCIC’s equity (as opposed to being on the leveraged amount, which can add up and decrease the overall return on investment for shareholders), with a 12.5% incentive fee that only begins to accrue when the pre-incentive fee yield to OCIC falls below a 5% annualized hurdle rate, and then fully catch-up, which we think is unusually generous. Overall, we believe that Blue Owl has assembled a credit and operational framework that warrants OCIC being considered in alternative credit portfolios, even at its current price of $18.70 as of 15 August 2025. The fund’s leverage remains conservative at 0.82x net debt-to-equity, providing plenty of headroom to increase leverage in the future if it wants to take advantage of future high-yielding opportunities. The 215% asset coverage ratio is also many times the required 150% regulatory minimum.

Private credit is an expanding sector of the broader alternative investments market, driven by the decline of traditional bank participation in the middle market. Blue Owl is well-positioned to benefit from this trend. Blue Owl is one of the most active direct lenders in the market due to its $284 billion of assets under management and longstanding relationships with a large number of private equity sponsors. We believe that these factors combine to provide a material sourcing advantage relative to smaller peers. Investors seeking a large-cap, high-yielding exposure to private credit with a high level of portfolio management expertise should strongly consider OCIC. The fund’s defensible underwriting, portfolio diversification, use of relatively modest levels of leverage and streamlined tax reporting make it an attractive core holding in a private credit portfolio. However, investors should be aware of the semi-liquid nature of the fund and the board’s discretion in determining when to allow redemptions.