v3.26.1
Derivatives
 6 Months Ended
Jun. 30, 2026
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivatives

Note 7. Derivatives

The Company enters into foreign currency forward contracts from time to time to help mitigate the impact that an adverse change in foreign exchange rates would have on the value of the Company’s investments denominated in foreign currencies.

For financial reporting purposes, cash collateral that has been pledged to cover obligations of the Company and cash collateral received from the counterparty, if any, is included under restricted cash and cash equivalents on the Consolidated Statement of Assets and Liabilities. There has been no cash collateral received or paid from the counterparty. The Company minimizes counterparty credit risk by only entering into agreements with counterparties that they believe to be of good standing and by monitoring the financial stability of those counterparties. All of the forward contracts qualify as Level 2 financial instruments.

During the six months ended June 30, 2026 and 2025 the Company’s average U.S. dollar ("USD") notional exposure to foreign currency forward contracts was $78,549 and $71,809, respectively.

The following table sets forth the Company’s net exposure to derivative contracts that are subject to ISDA Master Agreements or similar agreements (in thousands):

 

Reporting Date

 

Counterparty

 

Gross Amount
of Assets on
the Consolidated
Statements of
Assets and
Liabilities

 

 

Gross Amount
of (Liabilities) on
the Consolidated
Statements of
Assets and
Liabilities

 

 

Net Amount of Assets
or (Liabilities)

 

 

Collateral
(Received)
Pledged (1)

 

 

Net
Amounts (2)

 

June 30, 2026

 

Wells Fargo Bank, N.A.

 

$

1,255

 

 

$

(1,756

)

 

$

(501

)

 

$

440

 

 

$

(61

)

June 30, 2026

 

Goldman Sachs Bank USA

 

$

—

 

 

$

(3,040

)

 

$

(3,040

)

 

$

3,560

 

 

$

520

 

December 31, 2025

 

Wells Fargo Bank, N.A.

 

$

2,135

 

 

$

(2,134

)

 

$

1

 

 

$

—

 

 

$

1

 

 

(1)
Amount excludes excess cash collateral paid.
(2)
Net amount represents the net amount due (to) from counterparty in the event of a default based on the contractual setoff rights under the agreement. Net amount excludes any over-collateralized amounts.

The effect of transactions in derivative instruments to the Consolidated Statements of Operations was as follows (in thousands):

 

 

 

For the three months ended June 30,

 

 

For the six months ended June 30,

 

 

 

2026

 

 

2025

 

 

2026

 

 

2025

 

Net realized gain (loss) on foreign currency forward
   contracts

 

$

203

 

 

$

-

 

 

$

203

 

 

$

-

 

Net change in unrealized appreciation (depreciation) on
   foreign currency forward contracts

 

 

(427

)

 

 

(5,120

)

 

 

(502

)

 

 

(5,977

)

Total net realized and unrealized gains (losses) on
   foreign currency forward contracts

 

$

(224

)

 

$

(5,120

)

 

$

(299

)

 

$

(5,977

)

 

The Company's interest rate swaps have been designated in a qualifying hedge accounting relationship. Net realized and unrealized gains and losses for the six months ended June 30, 2026 and 2025, for the Company’s interest rate swap, are in the following locations in the Consolidated Statement of Operations:

 

For the three Months Ended June 30,

 

 

For the six Months Ended June 30,

Financial Statement Location

 

 

 

2026

 

 

2025

 

 

 

2026

 

 

2025

 

 

 

Interest rate swaps

 

$

 

142

 

 

$

 

-

 

 

$

 

139

 

 

$

 

-

 

 

Interest and debt financing expenses

Hedged items

 

 

 

(51

)

 

 

 

-

 

 

 

 

(28

)

 

 

 

-

 

 

Interest and debt financing expenses