Matthew Freund
About Matthew Freund
Matthew Freund, 36, is President and Co‑Portfolio Manager of Barings BDC (BBDC) and also serves as President of Barings Private Credit Corporation (BPCC) and Barings Capital Investment Corporation (BCIC). He joined Barings in 2015 after roles at U.S. Bank and Bank of America, holds a B.S. in Business Administration from Saint Louis University, and is a member of the CFA Institute . He is a Portfolio Manager to the Company and sits on Barings’ North American Private Finance Investment Committee, reflecting core credentials in private credit underwriting and portfolio management . Under his leadership commentary, BBDC emphasized portfolio quality and disciplined underwriting with weighted average interest coverage of 2.4x, low non‑accruals, and high first‑lien mix in 2025, highlighting conservative credit positioning through cycles .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Barings Global Private Finance Group | Senior Investment Manager | Joined 2015 | Structured, underwrote, and monitored North American private finance investments for sponsor clients |
| U.S. Bank | Structuring secured loans (LBO support) | Not disclosed | Structured secured loans for private equity sponsors |
| Bank of America | Underwriting and analytical roles (corporate & middle market coverage) | Not disclosed | Credit underwriting/analytics supporting middle‑market and corporate coverage |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Eclipse Business Credit | Board Member | Not disclosed | Specialty lender in asset‑backed loans; one of BBDC’s two largest positions providing differentiated returns and diversification |
| BPCC (Barings Private Credit Corporation) | President | Not disclosed | Leadership across affiliated BDC platform; portfolio origination/management alignment |
| BCIC (Barings Capital Investment Corporation) | President | Not disclosed | Leadership across affiliated BDC platform; portfolio origination/management alignment |
Fixed Compensation
BBDC is externally managed; executive officers (including Freund) are employees of Barings and do not receive direct compensation from BBDC. The Company pays Barings a base management fee and incentive fee under the advisory agreement.
| Component | Company Disclosure | Notes |
|---|---|---|
| Base salary | Not paid by BBDC | Executives are employed by Barings; compensation not disclosed at company level |
| Target bonus % | Not paid by BBDC | Compensation determined by Barings, not disclosed in BBDC proxy |
| Actual bonus | Not paid by BBDC | Not disclosed; executives compensated by Barings |
| Perquisites | Not disclosed | BBDC does not report executive perquisites; executives are Barings employees |
Adviser‑level fees (company pays adviser, not individuals):
| Adviser Fee | FY 2024 Amount ($) | Source |
|---|---|---|
| Base management fee | $32.4 million | Advisory Agreement fees paid by BBDC |
| Income‑based incentive fee | $23.8 million | Advisory Agreement fees paid by BBDC |
Performance Compensation
Executives are not compensated by BBDC; there is no disclosed executive performance plan at the company level. BBDC’s alignment is described via “fees and credit performance hurdles” in its externally managed structure .
| Metric | Weighting | Target | Actual/Payout | Vesting |
|---|---|---|---|---|
| Executive incentive metrics at BBDC | Not disclosed | Not disclosed | Not disclosed | Not disclosed |
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Shares beneficially owned | 15,971 |
| % of shares outstanding | Less than 1.0% |
| Options/warrants exercisable within 60 days | None outstanding |
| Hedging/derivatives | Prohibited for officers/directors under Insider Trading Policy |
| Pledging/margin | Pledging and margin accounts prohibited, with limited exceptions requiring pre‑approval from Chief Compliance Officer |
| Pre‑clearance/blackouts | Trading pre‑clearance required; quarterly and event blackouts apply |
Employment Terms
| Term | Disclosure |
|---|---|
| Officer status | Officers serve at the discretion of the Board |
| Employment by BBDC | BBDC has no employees; executives are Barings employees |
| Employment agreement, severance, change‑of‑control | Not disclosed by BBDC; such terms would reside with Barings and are not in the Company’s proxy |
| Insider trading governance | Pre‑clearance, blackouts, bans on short sales, options, hedging, margin/pledging (with limited approval path) |
Performance & Track Record
Freund’s commentary emphasizes BBDC’s conservative underwriting and portfolio quality, with consistent interest coverage and improving risk metrics.
| Portfolio Metric | Q1 2025 | Q2 2025 |
|---|---|---|
| Weighted average interest coverage (x) | 2.4 | 2.4 |
| Secured investments (%) | 74% | — |
| First‑lien investments (%) | 71% | — |
| Non‑accruals (% of assets, fair value) | 0.6% | 0.5% |
| Non‑accruals (% of assets, cost) | 1.8% | 1.4% |
| Risk ratings 4 & 5 (% issuers, combined) | 8% (vs. 11% prior qtr) | 7% (vs. 8% prior qtr) |
Additional highlights:
- Top two positions are strategic platforms: Eclipse Business Capital and Rocade Holdings, offering asset‑backed loans and litigation financing exposure .
- Management expects “complexity premium” sourcing to support returns in 2025, with disciplined underwriting through rate/spread cycles .
Investment Implications
- Compensation alignment and retention: As an externally managed BDC, Freund’s compensation is set by Barings and not disclosed at BBDC, limiting direct pay‑for‑performance analysis at the issuer level; alignment with shareholders is expressed via fee structure and credit performance hurdles, and via his modest personal share ownership (15,971 shares) .
- Trading signal risk: Insider hedging and pledging are prohibited (with narrow pre‑approval exceptions), reducing misalignment risk from derivatives or collateralization; no options outstanding within 60 days as of record date, lowering option‑related selling pressure .
- Execution record: Portfolio quality indicators (low non‑accruals, stable 2.4x interest coverage, improved high‑risk ratings) and high first‑lien mix underpin a defensive posture through macro uncertainty—supportive for credit outcomes, distributions, and NAV stability .
- Disclosure gap: Absence of BBDC‑level employment agreements, severance, change‑of‑control, and executive performance metrics constrains benchmarking and pay inflation risk assessment; any such terms would be at Barings and are not reported in the proxy .