KKR FS Income Trust Adds Up To $250 Million Multicurrency Credit Line With BMO
Lenders can look only to a special purpose subsidiary’s loan portfolio, which caps the trust’s exposure at its equity in that entity.
October 14, 2026
KKR FS Income Trust has closed a revolving credit facility of up to $250 million with Bank of Montreal. The facility sits in a special purpose financing subsidiary and can be drawn in four currencies.
The borrower, K-FIT Finance BMO-1 LLC, is a wholly owned subsidiary of the business development company and entered the agreement on October 7, 2026. Bank of Montreal serves as administrative agent, and Western Alliance Trust Company, N.A. is collateral custodian. KKR FS Income Trust acts as both equityholder and collateral manager of the subsidiary. The $250 million initial commitment can be increased with the consent of the lenders and the agent.
Pricing
Draws can be made in U.S. dollars, Canadian dollars, pounds sterling and euros, and each currency is priced off its own benchmark:
- U.S. dollars: Term SOFR
- Canadian dollars: Term CORRA
- Euros: EURIBOR
- Pounds sterling: Daily Simple SONIA
The spread over each benchmark is 1.85% during the revolving period and 2.00% after it ends. An event of default adds 2.00% per year to the applicable spread. The facility also carries a non-usage fee and, in certain circumstances, a prepayment premium.
Term
The subsidiary can borrow, repay and re-borrow until October 7, 2029, unless the revolving period ends earlier. All outstanding borrowings and accrued interest are due on October 7, 2031. Each advance depends on conditions that include maintaining the required borrowing base.
A Ring-Fenced Structure
The lenders hold a first priority security interest in substantially all of the subsidiary's assets, including its loan portfolio and related accounts. The obligations are non-recourse to KKR FS Income Trust itself. The trust's exposure is limited to the value of its equity in, and investment in, the subsidiary. If an event of default occurs, the administrative agent may terminate the commitments and declare all obligations immediately due.
Asset-based facilities held in special purpose subsidiaries are a standard financing tool for business development companies. They tie each lender's claim to a defined pool of collateral rather than to the full balance sheet. The BMO line gives the trust that kind of capacity in four currencies, with a borrowing window that runs into late 2029.
