Strong capital levels Consistent realized earnings Good funding Exposure to investment-market volatility High-risk portfolio with increasing proportion of mezzanine investments Standard&Poor's Ratings Services' ratings on New York City–based Ares Capital Corp. (NASDAQ: ARCC) are based on the firm's consistent financial performance, coupled with its strong capital levels and good funding in a difficult environment. Ares Capital's management has also maintained adequate liquidity through a very difficult environment. Ares Capital's increased exposure to high-risk assets and considerable portfolio depreciation partially offset these positive factors. From 2007 through 2009, credit-market dislocation has reduced competition for lending to larger, more creditworthy firms. Management has migrated toward larger investments in these larger firms and has been looking closely at secondary-market opportunities. Management
