ECB Pushes Banks to Reduce Risk in Booming Leveraged-Loan Market

Banks falling short may face extra capital requirements. Leveraged finance has been a key growth area for Deutsche Bank. The European Central Bank is pushing banks to improve how they control risks when they extend credit to highly-indebted companies, a growing business that promises both higher returns and a greater potential losses than traditional lending. […]

Performance test looms for $900bn private debt market

Investors who made loans during calmer times before pandemic face a reckoning, analysts say. Private debt investors face a shakeout, fund managers have warned, after a decade-long boom propelled the sector’s assets to around $900bn. The market flourished in the wake of the financial crisis as banks, under regulatory pressure, have retreated from making loans […]

Private Equity Turns to $3 Trillion in Unlocked Value for Loans

Some firms are using stakes in funds they manage as collateral. Investors are racing to make loans as demand increases. Private equity firms on the hunt for capital are increasingly turning to specialty lenders for financing and providing a valuable asset as collateral: stakes in their funds. The buyout industry has about $3 trillion of […]