JPMorgan's Dimon Warns of risks in booming private-credit market
Other - MAY 30, 2024

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JPMorgan’s Dimon Warns of risks in booming private-credit market

by Andrea Zander

JPMorgan Chase & Co. CEO Jamie Dimon warned of potential risks in the burgeoning private-credit market, suggesting that clients with locked-up funds might demand their money back and turn to their congressperson if issues arise. Despite these concerns, Dimon stated that JPMorgan could invest up to $200 billion in private-credit deals from its balance sheet, confident in their ability to compete with their substantial capital, according to a MorningStar article.

Private-credit lending, mainly involving private-equity firms lending to middle-market companies, has grown to more than $2.1 trillion in assets and committed capital in 2023, according to the International Monetary Fund. Investment banks like Goldman Sachs are also active in this space, with Goldman recently closing its West Street Loan Partners V fund, securing $13.1 billion in capital commitments.

The private-credit market’s size now rivals that of high-yield bonds and syndicated loans.

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