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Private credit’s recent ructions have meant that some trust in the market has been eroded.
The sector has seen some negative headlines following the bankruptcy of two US firms – Tricolor and First Brands – with fingers pointed at the private credit space, and particularly its due diligence and lending practices.
Private credit has grown in recent years to become a large part of many insurance companies' investment portfolios.
Private credit has been predicted to largely weather the recent storm; however, there could be some changes.
This week, Sitara Sundar, Head of Alternative Investment Strategy at JPMorgan Private Bank, said to Bloomberg that while she doesn't believe the growth in private credit markets poses a systemic risk, pockets of idiosyncratic risk will bubble up.
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