Big Banks Want Back in on the Private Debt Market
(23 January 2023 – Global) With the private credit market expected to reach $2.3 trillion over the next five years, banks like JPMorgan are looking to take back some market share.
One the most significant shifts within debt markets over the past 10 years has been the rise of private credit, following the retreat of traditional banks as they curbed their risk appetite.
According to Bloomberg, the private credit industry is now worth $1.4 trillion, with the likes of alternative asset managers like Apollo, Ares and Blackstone lending directly to companies.
Private credit assets under management is expected to grow another trillion dollars over the next five years to $2.3 trillion.
Much of the predicted growth in the private debt market is expected to be driven by loans to larger firms, rather than the small and medium sized businesses that banks had been content to let go.
Big banks are now looking to reclaim this lending with JPMorgan Chase announcing it has set aside at least $10 billion to support its move into private credit.