Chicago Atlantic BDC, Inc. (formerly Silver Spike Investment Corp.) reported its financial performance for the year ended December 31, 2024, showing a net investment income of approximately $9.5 million, compared to $6.6 million for the year ended December 31, 2023. Total investment income increased significantly to $21.7 million in 2024 from $11.9 million in 2023, driven primarily by a substantial increase in the principal balance of debt investments following the October 1, 2024 acquisition of a loan portfolio (Loan Portfolio Acquisition) valued at $219.6 million. Operating expenses also rose considerably to $12.2 million in 2024 from $5.3 million in 2023, largely due to $5.3 million in transaction expenses related to the Loan Portfolio Acquisition.
The Loan Portfolio Acquisition, completed on October 1, 2024, involved the issuance of 16,605,372 shares of common stock to Chicago Atlantic Loan Portfolio, LLC (CALP). This acquisition, along with the creation of a joint venture between Chicago Atlantic and the company's investment advisor, resulted in several changes to the company's board of directors and officer positions. The company was renamed Chicago Atlantic BDC, Inc., and its stock symbol changed to "LIEN" on October 2, 2024. A new investment advisory agreement and license agreement were also executed. On February 11, 2025, the company entered into a senior secured revolving credit agreement for up to $100 million.
As of December 31, 2024, the company's investment portfolio totaled approximately $275.2 million, consisting mainly of first lien senior secured loans ($239.9 million), senior secured notes ($34.7 million), and a smaller amount in equity securities. The portfolio's geographic distribution was diverse, with investments across various regions of the United States and Canada. The company's investment strategy focuses on four primary sub-strategies: cannabis, growth & technology, esoteric & asset-based lending, and liquidity solutions. The company's investment risk rating system categorized all investments as Grade 2 as of December 31, 2024, indicating performance in line with expectations.
The company's financial statements reflect the application of Financial Accounting Standards Board Accounting Standards Codification 820, Fair Value Measurement (ASC 820), resulting in a Level 3 classification for all investments as of December 31, 2024 and 2023. This necessitates significant estimates in the valuation process. The company's net asset value per share was $13.20 as of December 31, 2024, while the last reported closing sales price was $11.44, representing a discount of approximately 13.3%. The company intends to make quarterly distributions to stockholders, subject to various factors including earnings, financial condition, and compliance with regulatory requirements.
The company's 10-K filing also details various risk factors associated with its business, including economic downturns, competition, regulatory changes affecting the cannabis industry, and the inherent risks of investing in illiquid, below-investment-grade securities. The filing includes extensive disclosures regarding conflicts of interest, leverage, and the company's accounting policies and procedures. The company's outlook is contingent upon various factors, including the continued growth of the cannabis industry and its ability to successfully integrate the acquired loan portfolio.
About Chicago Atlantic BDC, Inc.
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