Jon Bock: Thank you, Brad. As Brad mentioned the focus on building a healthy and defensive portfolio that we believe allows us to continue to take advantage of our expanded pipeline from a position of strength. So jump to Slide 6, we ended the quarter with $9.5 billion of investments. We also continue to deliver modestly, the funds leverage at quarter end was 1.08x and quarterly average was 1.11x and those are well within our target range of 1x to 1.25x. We also were made well positioned with $1.5 billion of liquidity comprised of cash and borrowing amounts available across all our revolving credit facilities to lean in to that expanded pipeline Brad mentioned. Our weighted average yield on debt investments at fair value continues to increase steadily to 11.9% of this quarter end from 11.8% last quarter primarily driven by higher base rates.
New investments continue to be accretive to our investment income. The yield on new debt investment fundings during the quarter averaged 12.2%, while yield on assets repaid or sold down averaged 11.6%, improving our weighted outfield in the portfolio. And importantly, the base rates of the third quarter expanded approximately 300 basis points on our 98.8% floating rate debt portfolio compared to the same quarter in the prior year. In this environment of higher rates, we continue to focus on constructing a portfolio for resiliency and downside protection. I jump to Slide 7. Since BXSL inception, we’ve been disciplined in building our portfolio to focus on first lien senior secured debt, as we believe that is most offensive place for investors, especially at a higher interest rate and slower growth common economy.
Now over 98% of BXSL investments are in first lien senior secured loans of over 95% of loans or to companies owned by private equity firms, or other financial sponsor’s who generally have access to additional equity capital, and historically has shown a willingness to support their portfolio companies. These sponsors have significant equity value in these capital structures with an average loan-to-value of 46.9% in BXSL. We don’t only stress the importance of seniority in the portfolio, we’ve also emphasized what we view as better investment neighborhoods or historically lower default rate sectors, companies and sectors that we believe are facing more favorable tailwinds consistent growth trends and specifically businesses that we believe have stable growing margins, revenue visibility, strong management, lower CapEx. And in addition, we focus on larger scale businesses with significant market share, greater ability to pass through price increases and that should be able to withstand a slowdown.
Now looking at scale specifically. BXSL portfolio companies have a weighted average EBITDA of $185 million as of Q3 compared $162 million as of Q3 last year. This focus on higher quality, lower default rate sectors and larger scale businesses is a key driver in our credit performance, as supported by the fact that BXSL has less than 0.1% of loans on non-accrual at a cost compared to 2.8% at costs for traded BDC peers. Our non-accrual rate declined from the previous quarter driven by a restructuring in the third quarter. Now, Slide 8 focuses on our industry exposure, where we believe investing in better companies, in better neighborhoods drive strong returns over time. This means focusing on key sectors with among other themes, lower default rates, lower CapEx requirements, and approximately 90% of BXSL total portfolio is invested in historically lower default rate sectors, including software, health care, commercial services, which are some of the highest exposures in the portfolio.
Then Slide 9 further outlines our portfolio quality. In addition to our focus on investing in higher quality, lower default rate sectors, BXSL’s portfolio focused on investing in larger companies, based on our belief that larger scale businesses are more resilient in the face of economic headwinds relative to smaller counterparts, and that historically has had lower default rates. Our origination effort has been based on supporting companies at scale because we believe that’s where the most compelling risk adjusted return is found. The slide indicates that the relative risk adjusted return have spread per turn of leverage for smaller deals versus larger deals has a slight disparity, but we noticed more substantial differences in underlying credit health.
