The stratospheric growth that private credit has experienced over the past 10 years comes with responsibility, and it’s no surprise that regulators and observers have been worrying about whether the nearly $2 trillion asset class will pose a systemic risk to the broader financial system due to its interconnectedness with banks and insurance companies.
Determining private credit’s systemic risk
While regulators are worried about systemic risk from private credit, KBRA research suggests risk is contained.
