10-K: FSK Reports Sharp Decline in 2025 Net Assets & Returns

Sentiment:

Annual Report 25 February 2026 4:40 PM

FS KKR Capital Corp. experienced a significant drop in net assets and total returns in 2025, alongside increased non-accrual investments.

Capital raiseOn May 9, 2025, the company entered into Equity Distribution Agreements with Truist Securities, Inc., RBC Capital Markets, LLC, KKR Capital Markets LLC, and SMBC Nikko Securities America, Inc. for an At-The-Market (ATM) Program.Under the ATM Program, the company may issue and sell up to an aggregate gross amount of $750 million in shares of its common stock through public or at-the-market offerings.Sales under the ATM Program will be at a price per share not less than the net asset value per share, unless the Adviser pays commissions or makes supplemental payments to ensure this condition.The company did not issue or sell shares under the ATM Program during the year ended December 31, 2025.

Worse than expectedNet increase in net assets from operations decreased significantly from $585 million in 2024 to $11 million in 2025.Total return based on net asset value dropped from 8.50% in 2024 to 0.21% in 2025.Total return based on market value turned negative at (20.31)% in 2025, compared to a positive 25.29% in 2024.Investment income declined due to lower yields and an increase in non-accrual investments.The percentage of non-accrual investments increased to 3.4% in 2025 from 2.2% in 2024, indicating a decline in portfolio credit quality.

Summary

Net increase in net assets resulting from operations plummeted to $11 million ($0.04 per share) in 2025, a substantial decrease from $585 million ($2.09 per share) in 2024.
Total assets decreased to approximately $13.7 billion as of December 31, 2025, down from $14.2 billion in 2024.
Total return based on net asset value was 0.21% in 2025, a sharp decline from 8.50% in 2024.
Total return based on market value was a negative (20.31)% in 2025, contrasting with a positive 25.29% in 2024.
Investment income decreased to $1,519 million in 2025 from $1,721 million in 2024, primarily due to lower yields and increased non-accrual assets.
Non-accrual investments, based on fair value, increased to 3.4% of the portfolio in 2025 from 2.2% in 2024.
The weighted average annual yield on accruing debt investments decreased to 10.1% in 2025 from 11.3% in 2024.
Net realized losses on investments, financial instruments, and foreign currency totaled $(376) million in 2025, compared to $(476) million in 2024.
Net change in unrealized appreciation (depreciation) shifted significantly to $(248) million in 2025 from $248 million in 2024, driven by reduced valuations of certain portfolio companies.
The company declared total dividends of $2.80 per share in 2025, a slight decrease from $2.90 per share in 2024.
As of December 31, 2025, the company's asset coverage ratio was 177%, maintaining compliance with the 150% requirement under the 1940 Act.
The company's investment portfolio is primarily composed of senior secured debt (first and second lien loans, senior secured bonds) of private middle-market U.S. companies, with 60.9% in variable rate debt and 8.2% in fixed rate debt.
Unfunded debt commitments totaled $1,447.4 million, with additional unfunded equity/other commitments of $87.5 million and $245.0 million to Credit Opportunities Partners JV, LLC (COPJV) as of December 31, 2025.

Sentiment

Score: 3

Explanation: StockSavvy.ai views this as a negative report, primarily due to the substantial decline in net assets, total returns, and the increase in non-accrual investments, indicating significant underperformance in 2025 compared to the previous year.

Positives

The company maintains a diversified portfolio across various issuers and industries, aiming to mitigate risks from downturns in specific sectors.
The Adviser leverages a large, scalable, global platform with approximately 250 dedicated investment professionals and the broader resources of KKR & Co. to source and manage investments.
The company focuses on providing customized credit solutions to private upper middle market companies, often serving in a lead financing role for larger transactions, which is a competitive advantage.
The long-term investment horizon provides flexibility, allowing for potentially higher total returns compared to investment vehicles with capital return requirements.
The company's asset coverage ratio of 177% as of December 31, 2025, demonstrates compliance with regulatory leverage requirements (150% minimum).

Negatives

Net increase in net assets from operations significantly decreased to $11 million in 2025 from $585 million in 2024.
Total return based on net asset value dropped to 0.21% in 2025 from 8.50% in 2024.
Total return based on market value was a negative (20.31)% in 2025, a substantial reversal from a positive 25.29% in 2024.
Investment income declined in 2025 compared to 2024, primarily due to lower yields on investments and an increase in non-accrual assets.
The percentage of investments on non-accrual status increased to 3.4% of the portfolio (by fair value) in 2025 from 2.2% in 2024, indicating deteriorating credit quality in some holdings.
Net change in unrealized appreciation (depreciation) shifted from a positive $248 million in 2024 to a negative $(248) million in 2025, reflecting reduced valuations of certain portfolio companies.
The company recorded a net realized loss from the extinguishment of debt of $(7) million in 2025.
The weighted average annual yield on accruing debt investments decreased from 11.3% in 2024 to 10.1% in 2025.

Risks

Dependence on the Adviser's ability to manage and support the investment process; termination of the Advisory Agreement or loss of senior management could harm investment objectives.
Inability of the Adviser to maintain or develop relationships with private equity sponsors, investment banks, and commercial banks could adversely affect business.
Operating in a highly competitive market for investment opportunities, which could reduce returns and result in losses.
Cybersecurity risks, including potential breaches or disruptions to electronic data systems, could compromise business operations, liquidity, and reputation.
Conflicts of interest faced by the Adviser and its affiliates due to compensation arrangements, potentially leading to riskier investments or increased leverage.
Obligation to pay incentive compensation on income not yet received, particularly from accrued interest on defaulted loans.
Obligation to pay incentive compensation even if a net loss is incurred due to a decline in portfolio value.
Diversion of time and resources by the Adviser's personnel to other entities and potential competition for investment opportunities.
Limited liability of the Adviser under Advisory and Administration Agreements, potentially leading to riskier actions on the company's behalf.
Potential for the Adviser or its affiliates to purchase company shares, creating risks related to asset disposition timing or financial obligations.
Reliance on key personnel of the Adviser; loss of such personnel could impair management ability.
Failure to maintain Business Development Company (BDC) status would reduce operating flexibility.
Uncertainty of future capital funding sources; inability to obtain debt or equity financing on acceptable terms could adversely affect investment acquisition and expansion.
Requirement to invest a sufficient portion of assets in qualifying assets could restrict investment strategy or lead to loss of BDC status.
Regulations governing BDC and RIC operations affect ability to raise capital, potentially limiting growth.
Restrictions on transactions with affiliates under the 1940 Act, potentially limiting investment opportunities.
Investments in prospective portfolio companies may be risky, leading to partial or total loss of investment.
Investments in asset-based finance opportunities involve reliance on operator information and potential illiquidity.
Subordinated debt investments carry heightened risk and volatility, with potential for total loss of principal.
Equity and equity-related securities may not appreciate in value, and gains may not offset other losses.
Convertible securities are subject to redemption risk by the issuer, potentially affecting investment objectives.
Preferred securities may defer distributions, requiring cash distributions for tax purposes without corresponding cash receipt.
Investments in non-U.S. securities expose the company to political, economic, currency, and regulatory risks.
Structured products, including CLOs, may be highly levered and subject to higher risk of total loss or deferral of payments.
Investments in private investment funds subject the company to underlying risks of such funds and additional fees/expenses.
Price declines in the mediumand large-sized U.S. corporate debt market could adversely affect portfolio fair value.
Inflation may adversely affect portfolio companies' business, results, and financial condition.
Securities lending agreements carry risks of delayed recovery or loss of collateral.
Hedging transactions may be costly and ineffective, potentially reducing cash available for debt service or distributions.
Investing in middle-market companies involves risks such as limited financial resources, shorter operating histories, and dependence on key management.
Portfolio companies may incur debt senior to the company's investments, leading to subordination of claims.
Investments in publicly traded companies may lack negotiated covenants and access to information.
Debt investments could be recharacterized as equity in bankruptcy or subject to lender liability claims.
Second priority liens on collateral may be controlled by senior creditors, potentially leaving insufficient collateral for repayment.
Lack of control over most portfolio companies means business decisions may not align with the company's interests.
Illiquidity of investments in non-traded companies may hinder timely disposition or appropriate valuation.
Changes to U.S. tariff and import/export regulations could negatively affect portfolio companies.
Declines in market or fair market values of investments, even if unrealized, reduce net asset value.
Uncertainty in valuing a significant portion of the investment portfolio due to lack of readily available market prices.
Exposure to risks associated with changes in interest rates, affecting cost of capital and net investment income.
Covenant breaches by portfolio companies may harm operating results and lead to defaults.
Highly leveraged portfolio companies face increased financial and operating risks.
Inability to realize gains from equity investments if portfolio companies lack liquidity events.
Challenges in investing in privately held companies due to lack of available information and illiquidity.
Inability to make additional investments in portfolio companies could negatively impact their performance or dilute the company's position.
Prepayments of debt investments could adversely impact results of operations and reduce return on equity.
Original issue discount and PIK instruments expose the company to non-cash income risks and unreliable valuations.
Use of a wide range of investment techniques could expose the company to diverse and unanticipated risks.
Investments through joint ventures or other special purpose vehicles may entail greater risks due to third-party management or inconsistent objectives.
Syndication of co-investments may not be successful, leading to higher concentration risk.
Use of indebtedness (leverage) magnifies potential for gain or loss on common stock.
Covenants in debt financing arrangements, if not complied with, could materially adversely affect ability to meet obligations and pay distributions.
Provisions in credit facilities may limit investment discretion and ability to restructure debt.
Formation of CLOs may subject the company to structured financing risks and limitations on distributions.
Risk that investors may not receive distributions or that distributions may decrease over time.
Distribution proceeds may exceed earnings, representing a return of capital and lowering tax basis.
Shares of common stock may trade at a discount to net asset value.
Distributions may be paid from offering proceeds, borrowings, or asset sales, potentially diluting capital.
Dilution of stockholder interest if additional shares are issued without preemptive rights.
Certain charter and bylaws provisions, and MGCL provisions, could deter takeover attempts.
Uncertainty surrounding the application of the Maryland Control Share Acquisition Act (MCSAA).
Fluctuations in net asset value and market price of common stock due to various factors.
Future sales of common stock or senior securities could adversely affect trading price and ability to raise funds.
Issuance of preferred stock, debt, or convertible debt could increase volatility of common stock.
Holders of preferred stock would have rights to elect directors and class voting rights.
Issuance of common stock below net asset value could dilute stockholders' interest.
Corporate-level income tax if unable to qualify as a RIC or satisfy distribution requirements.
Difficulty paying required distributions if income is recognized before or without receiving cash.
Investments may present special tax issues, potentially requiring taxable distributions without cash.
Taxation as though some expenses were distributions if not qualified as a publicly offered RIC.
Legislative or regulatory tax changes could adversely affect investors.
Capital markets may experience periods of disruption and instability, affecting debt and equity markets.
Future economic recessions or downturns could impair portfolio companies and harm operating results.
Events outside of control (force majeure) could negatively affect portfolio companies and results.
Extended periods of capital market disruption could lead to reduced or no distributions.
Uncertainty about U.S. federal government initiatives (tariffs, trade) could negatively impact business.
Economic sanction laws may prohibit transactions with certain countries, individuals, and companies.
Adverse developments affecting the financial services industry could impact cash balances and funding access.

Future Outlook

The company intends to qualify annually as a Regulated Investment Company (RIC) and make sufficient distributions to stockholders to maintain this tax status. It may seek stockholder approval to issue shares below net asset value after August 15, 2026. The Adviser will continue to tailor investment focus as market conditions evolve, potentially adjusting exposure to less senior capital structures or making opportunistic investments. The company expects to finance long-term fixed-rate investments primarily with equity and long-term debt and may use interest rate risk management techniques.

Management Comments

The Adviser will seek to tailor our investment focus as market conditions evolve.
We believe that the power to classify or reclassify unissued shares of capital stock and thereafter issue the classified or reclassified shares provides us with increased flexibility in structuring possible future financings and investments and in meeting other needs that might arise.
We believe this relief enhances our ability to further our investment objectives and strategy. We believe this relief may also increase favorable investment opportunities for us in part by allowing us to participate in larger investments, together with our co-investment affiliates, than would be available to us if such relief had not been obtained.

Industry Context

StockSavvy.ai notes that the Business Development Company (BDC) sector, particularly those focused on middle-market lending, faces ongoing challenges from competitive markets and fluctuating interest rates. The company's strategy of focusing on larger middle-market companies and offering customized credit solutions aims to differentiate it in a crowded market where traditional financial institutions have reduced their lending to this segment. The increased scrutiny on sustainability matters and the rapid evolution of AI technology are emerging industry trends that could impact BDCs and their portfolio companies, requiring adaptive risk management and investment strategies.

Comparison to Industry Standards

The company's asset coverage ratio of 177% as of December 31, 2025, is above the statutory minimum of 150% for BDCs, indicating a healthy leverage position relative to regulatory requirements.
The decline in total return based on net asset value to 0.21% in 2025 and a negative market value return of (20.31)% suggests underperformance compared to the S&P 500 Index (which typically saw positive returns in 2025, though specific data for 2025 is not provided in the filing for comparison, 2024 was 25.29% for FSK and S&P 500 was positive).
The increase in non-accrual investments to 3.4% in 2025 from 2.2% in 2024 indicates a deterioration in portfolio asset quality, which may be higher than industry averages for well-performing BDCs.
The weighted average annual yield on accruing debt investments of 10.1% in 2025 is generally competitive within the private credit market for middle-market loans, though it decreased from 11.3% in 2024.
The company's investment in structured products and derivatives, while offering potential for enhanced returns, also exposes it to risks similar to those faced by other financial institutions utilizing complex instruments, such as those seen in the broader financial services industry.

Corporate Governance

Change Type	Description	Effective Date	Impact Assessment
Board Classification	The company's Board of Directors is classified into three classes serving staggered three-year terms.	NA	This provision may discourage, delay, defer, make more difficult or prevent a transaction or a change in control.
Director Removal	A director may be removed from office only for cause and only by the affirmative vote of at least two-thirds of the votes entitled to cast generally in the election of directors.	NA	This provision may discourage, delay, defer, make more difficult or prevent a transaction or a change in control.
Filling Board Vacancies	Any and all vacancies on the board of directors may be filled only by the affirmative vote of a majority of the remaining directors in office, even if the remaining directors do not constitute a quorum.	NA	This provision may discourage, delay, defer, make more difficult or prevent a transaction or a change in control.
Stock Classification Authority	A majority of the board of directors, without any action by stockholders, may amend the charter to increase or decrease the aggregate number of shares of stock or the number of shares of stock of any class or series that the company has authority to issue. The board can also classify or reclassify any unissued shares of common stock or preferred stock.	NA	Provides increased flexibility in structuring future financings and investments, but could also delay, defer, or prevent a change in control.
Stockholder Action	Stockholder action can be taken only at an annual or special meeting of stockholders or by unanimous consent in lieu of a meeting (unless the charter permits less than unanimous consent, which it does not).	NA	May delay consideration of stockholder proposals until the next annual meeting.
Advance Notice Provisions	Bylaws require advance notice for stockholder nominations for directors and proposals for business at annual and special meetings.	NA	May preclude a contest for director election or consideration of stockholder proposals if proper procedures are not followed, potentially discouraging third-party solicitations.
Exclusive Forum	Bylaws designate the Circuit Court for Baltimore City, Maryland, or the U.S. District Court for the District of Maryland, Baltimore Division, as the sole and exclusive forum for certain internal corporate claims and Securities Act claims.	NA	Aims to centralize litigation, potentially reducing costs and increasing predictability, but may limit stockholders' choice of forum.
Calling Special Meetings	Special meetings of stockholders may be called by the board of directors and certain officers, or upon written request of stockholders entitled to cast not less than a majority of all votes entitled to be cast.	NA	Provides a mechanism for stockholder-initiated meetings, but sets a high threshold (majority vote).
Extraordinary Corporate Action Approval	Actions requiring stockholder approval (e.g., charter amendments, dissolution, merger) must be advised by the board and approved by a majority of votes entitled to be cast, with an 80% vote required for certain fundamental changes (e.g., making common stock redeemable, converting to open-end company), unless approved by two-thirds of Continuing Directors.	NA	Provides significant protection against hostile takeovers and ensures board oversight in major corporate decisions.
Bylaw Amendment Power	The board of directors has the exclusive power to make, alter, amend, or repeal any provision of the bylaws.	NA	Centralizes control over internal governance rules with the board.
No Appraisal Rights	Stockholders are generally not entitled to exercise appraisal rights, except for those arising in connection with the Control Share Acquisition Act.	NA	Limits stockholders' ability to demand fair value for their shares in certain extraordinary transactions.
Control Share Acquisitions Exemption	Bylaws exempt any and all acquisitions of the company's stock from the Maryland Control Share Acquisition Act (MCSAA).	NA	Removes a potential deterrent to hostile takeovers, though this provision can be amended or eliminated.
Business Combination Act Exemption	Board adopted a resolution exempting any business combination with any person from the Maryland Business Combination Act, provided it receives prior board approval (including a majority of independent directors).	NA	Facilitates certain business combinations but can be altered or repealed, potentially discouraging acquisitions.
Maryland General Corporation Law Election	Board elected into certain MGCL provisions, allowing it to classify itself without stockholder vote, fix the number of directors, require two-thirds vote for director removal, and retain sole authority to fill vacancies.	NA	Strengthens board control and stability, potentially making it harder for stockholders to influence board composition.
Inspection of Books and Records	Stockholders have no right to inspect books if the board determines an improper purpose for the request.	NA	Grants the board discretion to limit stockholder access to company records.
Conflict with 1940 Act	Bylaws state that if any MGCL or charter/bylaw provision conflicts with a mandatory 1940 Act provision, the 1940 Act controls.	NA	Ensures compliance with federal investment company regulations, which are paramount for a BDC.

Legal Proceedings

Neither the company, the Adviser, nor its subsidiaries are currently subject to any material legal proceedings, nor is any material legal proceeding threatened against them, other than ordinary routine litigation incidental to business.
On January 14, 2025, the Antitrust Division of the U.S. Department of Justice (DOJ) filed a civil antitrust complaint against KKR & Co. and various KKR-sponsored investment entities, alleging violations of the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR Act).
The DOJ Complaint requests civil penalties and equitable relief, including disgorgement and enjoining future HSR Act violations.
KKR & Co. filed a counter-complaint on January 14, 2025 (re-filed January 16, 2025) requesting declaratory judgments that it did not violate the HSR Act, that DOJ/FTC interpretations are unconstitutionally vague, and that the DOJ seeks an excessive fine.
KKR & Co. intends to vigorously defend against the DOJ Complaint and filed a motion to dismiss on April 17, 2025.
The DOJ filed its motion to dismiss KKR's counter-complaint on April 23, 2025, and KKR & Co. and the DOJ agreed to dismiss one count and stay the rest of the DOJ's motion to dismiss.
The DOJ has continued investigations into KKR & Co.'s past HSR filings, and KKR & Co. continues to cooperate.
There is no certainty as to the outcome of the DOJ Complaint, KKR Complaint, or DOJ investigations, which could result in adverse financial and non-financial consequences to KKR & Co. and potentially significant monetary penalties or remedial measures.

Related Party Transactions

The company is externally managed by FS/KKR Advisor, LLC (the Adviser) and pays a base management fee and an incentive fee for investment advisory services.
The base management fee is 1.50% annually of the average weekly value of gross assets (excluding cash and cash equivalents), with a permanent waiver reducing it to 1.0% on assets financed using leverage over 1.0x debt-to-equity.
The incentive fee has two components: a subordinated income incentive fee (17.5% of pre-incentive fee net investment income above a 1.75% quarterly hurdle rate) and an incentive fee on capital gains (20% of cumulative realized capital gains net of losses and unrealized depreciation).
The Adviser is reimbursed for administrative expenses incurred on the company's behalf under an Administration Agreement.
During 2025, the company accrued $206 million in management fees, $136 million in subordinated income incentive fees, and $10 million in administrative services expenses.
The Adviser and its affiliates provide investment advisory services to other affiliated entities (KKR FS Income Trust and KKR FS Income Trust Select), creating potential conflicts of interest in allocating time and investment opportunities.
The company operates under a Co-Investment Exemptive Order (granted January 5, 2021) that permits co-investments in privately negotiated transactions with co-investment affiliates, subject to certain conditions and independent director approval.
On June 16, 2025, the company applied for streamlined co-investment exemptive relief to supersede the existing order, aiming for simplified conditions and more flexibility.
Certain affiliates of the Adviser's owners committed $100 million to a $350 million investment vehicle that may transact in the company's shares. This vehicle entered into trading plans in August 2023 and March 2024 to sell shares.
The company is permitted to borrow from an affiliate of the Adviser, with such borrowings being unsecured, non-interest accruing, and repaid within 1-2 days (no outstanding borrowings as of December 31, 2025).
The company co-invests with South Carolina Retirement Systems Group Trust (SCRS) through Credit Opportunities Partners JV, LLC (COPJV), with each having 50% voting control.
As of December 31, 2025, COPJV had total capital commitments of $2.8 billion, with $2.45 billion from the company and $0.35 billion from SCRS. The company had funded approximately $2.2 billion of its commitment.
As administrative agent of COPJV, the company earns a fee of 0.25% of COPJV's assets under administration, totaling $11.1 million in 2025.
During 2025, the company sold $1,829 million of investments to COPJV, recognizing a net realized gain of $23.8 million.
On February 23, 2026, the company sold $189 million of its equity interests in COPJV to SCRS, increasing SCRS's capital commitment by $175 million and adjusting ownership percentages.

Stakeholder Impact

Shareholders: Experienced a significant decline in net asset value and market value per share, and a lower total return in 2025. Distributions per share also slightly decreased. Potential for further dilution if shares are issued below NAV. The sale of COPJV interests to SCRS could impact future returns from the joint venture.
Employees (of Adviser/Affiliates): The Adviser's compensation structure (base management fee based on gross assets and incentive fees) could incentivize riskier investments, potentially impacting long-term stability. Loss of key personnel could adversely affect the company's performance.
Portfolio Companies: Increased non-accrual investments suggest some portfolio companies are facing financial difficulties, potentially leading to defaults and reduced recovery for the company. Changes in U.S. trade policies and economic conditions could negatively impact their operations.
Creditors: The company's asset coverage ratio remains above regulatory minimums, providing a buffer. However, increased leverage and potential for portfolio losses could increase risk for debt holders.
Regulatory Bodies: The company is subject to extensive SEC and 1940 Act regulations, with ongoing compliance efforts and potential for increased scrutiny, as evidenced by the DOJ's antitrust complaint against KKR & Co. and its affiliates.

Next Steps

The company will continue to monitor compliance with all future NYSE listing standards and take necessary actions.
The company intends to qualify annually as a Regulated Investment Company (RIC) for U.S. federal income tax purposes.
The company may seek stockholder approval to issue shares of common stock at prices below the then-current net asset value per share for a twelve-month period after August 15, 2026.
The Adviser will continue to tailor the investment focus as market conditions evolve, potentially adjusting exposure to less senior capital structures or making opportunistic investments.
The Board of Directors declared a regular quarterly distribution of $0.48 per share (consisting of a $0.45 base distribution and a $0.03 supplemental distribution) to be paid on or about April 2, 2026, to stockholders of record as of March 18, 2026.
The company will continue to assess the impact of ASU 2024-03, Income StatementReporting Comprehensive IncomeExpense Disaggregation Disclosures, which is effective for fiscal years beginning after December 15, 2026.

Key Dates

Date	Description
2007-12-21	Company incorporated under Maryland general corporation laws.
2009-01-02	Company formally commenced investment operations.
2013-06-04	SEC granted exemptive relief (FS Order) for co-investments with certain affiliates of former investment adviser.
2014-02-20	Darby Creek LLC entered into a revolving credit facility with Deutsche Bank AG.
2014-04-16	Common stock began trading on the NYSE under ticker symbol FSIC.
2014-10-17	Burholme Funding LLC entered into a committed facility arrangement with BNP Paribas Prime Brokerage International, Ltd.
2014-12-02	Dunlap Funding LLC entered into a revolving credit facility with Deutsche Bank.
2015-12-02	CCT Tokyo Funding LLC entered into a revolving credit facility with Sumitomo Mitsui Banking Corporation.
2018-04-09	Company entered into an administration agreement with the Adviser.
2018-08-09	Company entered into a senior secured revolving credit facility with JPMorgan.
2018-12-20	Common stock began trading under the ticker symbol FSK.
2019-06-14	Stockholders approved the application of the modified asset coverage requirement, reducing it from 200% to 150%.
2019-06-15	Effective date of reduced asset coverage requirement (150%).
2019-06-25	FS KKR MM CLO 1 LLC completed a $378.7 million term debt securitization (CLO 1 Transaction).
2019-11-20	Company issued $425 million aggregate principal amount of 4.125% Notes due 2025.
2019-11-22	Meadowbrook Run LLC entered into a revolving credit facility with Morgan Stanley Senior Funding, Inc.
2019-12-17	Company issued an additional $45 million aggregate principal amount of 4.125% Notes due 2025.
2020-04-30	Company issued $250 million aggregate principal amount of 8.625% Notes due 2025.
2020-12-10	Company issued $1,000 million aggregate principal amount of 3.400% Notes due 2026.
2020-12-22	CLO 1 Issuer refinanced the CLO 1 Transaction through a private placement of $383.7 million of senior secured notes (CLO Reset Notes).
2021-01-05	SEC granted exemptive relief (Co-Investment Exemptive Order) permitting co-investments with certain affiliates.
2021-03-31	COPJV sold $300 million aggregate principal amount of unsecured notes (April 2021 COPJV Notes).
2021-06-16	Company assumed $475 million aggregate principal amount of 4.250% Notes due 2025 in the 2021 Merger; Amended and Restated Investment Advisory Agreement dated.
2021-06-17	Company issued $400 million aggregate principal amount of 2.625% Notes due 2027.
2021-08-17	COPJV sold $225 million aggregate principal amount of Series B senior unsecured notes (August 2021 COPJV Notes).
2021-10-12	Company issued $750 million aggregate principal amount of 3.125% Notes due 2028.
2022-01-18	Company issued $500 million aggregate principal amount of 3.250% Notes due 2027.
2022-10-31	Board of Directors approved a renewal of the Stock Repurchase Program for up to $54 million.
2022-11-14	Effective date for CCT Tokyo Funding to pay a non-usage fee on the unused portion of its revolving credit facility.
2023-04-27	Dunlap Funding merged into Darby Creek LLC, terminating the Dunlap Credit Facility.
2023-06-08	Burholme Funding LLC terminated its committed facility arrangement with BNPP.
2023-08-01	Investment vehicle entered into August 2023 Affiliated Seller Program to sell up to 16.4 million shares of common stock.
2023-11-02	Special distributions declared for February 14, 2024 and May 15, 2024.
2023-11-21	Company issued $400 million aggregate principal amount of 7.875% Notes due 2029.
2024-03-01	Investment vehicle entered into March 2024 Affiliated Seller Program to sell up to 3.8 million shares of common stock.
2024-06-06	Company issued $600 million aggregate principal amount of 6.875% Notes due 2029 and entered into interest rate swap agreements.
2024-08-15	Expiration date for stockholder approval to sell shares below NAV (current authorization).
2024-09-19	Company's effective shelf registration statement on Form N-2 became effective.
2024-11-20	Company issued $600 million aggregate principal amount of 6.125% Notes due 2030 and entered into interest rate swap agreements.
2024-12-27	Company issued an additional $100 million aggregate principal amount of 6.125% Notes due 2030.
2025-02-01	4.125% Notes due 2025 matured and were redeemed in full.
2025-02-14	4.250% Notes due 2025 matured and were redeemed in full.
2025-03-16	Company exercised option to redeem 8.625% Notes due 2025 in full.
2025-03-20	COPJV issued $450 million aggregate principal amount of March 2025 COPJV Notes.
2025-03-28	KKR FSK CLO 2 LLC completed a $380 million term debt securitization (CLO 2 Transaction).
2025-03-24	Second Amended and Restated Limited Liability Company Agreement for COPJV amended, increasing capital commitments.
2025-05-09	Company entered into Equity Distribution Agreements for an At-The-Market (ATM) Program to sell up to $750 million in common stock.
2025-06-02	Callowhill Street Funding LLC entered into a revolving credit facility (Callowhill Credit Facility).
2025-06-05	Darby Creek LLC repaid all outstanding borrowings and terminated its loan financing and servicing agreement.
2025-06-16	Company applied for streamlined co-investment exemptive relief.
2025-07-16	Availability under the Senior Secured Revolving Credit Facility will terminate.
2025-09-11	KKR FSK CLO 3 LLC formed.
2025-09-18	Company entered into an interest rate swap agreement for 6.125% Notes due 2031.
2025-09-25	Company issued $400 million aggregate principal amount of 6.125% Notes due 2031.
2025-12-17	Ambler Funding LLC terminated its committed facility arrangement with Ally Bank.
2025-12-18	CLO 1 Notes redeemed in full; KKR FSK CLO 3 LLC completed a $389.5 million term debt securitization (CLO 3 Transaction).
2025-12-31	Company adopted ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures.
2026-01-15	3.400% Notes due 2026 will mature.
2026-02-19	Board declared a regular quarterly distribution of $0.48 per share.
2026-02-20	As of this date, 280,066,433 shares of common stock were outstanding; last reported closing sales price was $12.97 per share.
2026-02-23	Company sold $189 million of its equity interests in COPJV to SCRS, increasing SCRS's capital commitment by $175 million.
2026-04-02	Payment date for the quarterly distribution declared on February 19, 2026.
2026-08-15	Current authorization to sell shares below NAV expires.
2026-12-15	ASU 2024-03, Income StatementReporting Comprehensive IncomeExpense Disaggregation Disclosures, is effective for fiscal years beginning after this date.
2028-03-31	Interim periods for ASU 2024-03 begin with the first quarter ended this date.

Recommendation

hold

The significant decline in net assets, total returns, and the increase in non-accrual investments in 2025 indicate substantial underperformance and deteriorating portfolio quality. While the company maintains regulatory compliance and has a robust investment platform, the negative trends warrant caution. The recent sale of COPJV interests and the ATM program introduce new dynamics. A 'hold' recommendation is appropriate as investors should monitor whether these negative trends stabilize or reverse in future periods, and how the company's strategic initiatives and market conditions evolve.

Keywords

Business Development Company, BDC, SEC Filing, 10-K, FS KKR Capital Corp, FSK, Private Credit, Middle Market Lending, Senior Secured Loans, Subordinated Debt, Asset Based Finance, Investment Portfolio, Net Asset Value, Total Return, Non-Accrual Investments, Dividend, Interest Rates, Leverage, Risk Management, Corporate Governance, RIC Status, Financial Performance, Unrealized Depreciation, Capital Markets, Economic Downturn, Cybersecurity, Related Party Transactions, Joint Venture

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