The rapid expansion of private credit is creating a supply/demand imbalance that is again pressuring spreads and underwriting terms, according to Fitch Ratings’ commentary, sourcing analysts and external panelists at the rating agency’s recent Private Credit forum held in Chicago.
While the prospect of increased regulation kept banks largely on the sidelines last year, Meghan Neenan, managing director, noted that banks had become more active in recent months as seen with several bank/non-bank partnerships of late. This raises the question of how the pending return of banks and other syndicated market participants will shape the direct lending space.
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