Moody’s Ratings this week gave private credit investors greater reason for concern about credit quality in the $1.7 trillion industry.

The ratings company reduced its outlook for direct lending funds managed respectively by BlackRock (NYSE: BLK), KKR (NYSE: KKR) alongside FS Investments and Oaktree Capital Management (NYSE: OAK-A), lowering them to negative from stable. The three publicly traded business development companies, with a combined total of more than $20 billion in assets, each increased the number of loans on non-accrual status, meaning they’re in danger of losing money on those investments. While the BDCs retained their Baa3 rating, the lowest rung of investment grade, the change to a negative outlook is the first such move by Moody’s in private credit since 2020.