Banks’ links to private credit could pose systemic risk, says Boston Fed

Banks’ credit to NBFIs falls sharply

KARACHI: Banks’ credit to non-bank financial institutions (NBFIs) sharply declined to Rs416 billion during November-May FY25, compared to over Rs1 trillion by mid-Nov FY25. The State Bank’s latest data showed that banks had pulled back their funds from NBFIs, which were earlier injected largely to avoid government-imposed tax measures. Banks had pumped over Rs1tr into NBFIs — a record for the sector — apparently as a strategy to avoid the increm…

Banks’ links to private credit could pose systemic risk, says Boston Fed

Report highlights how direct lenders are forging increasingly close ties to more tightly regulated financial groups

Proskauer: Three risks to monitor in private credit

Proskauer has identified three risks to monitor in private credit, including around conflicts and calculating values. First, it warned of conflicts that can arise around deal sourcing arrangements. As private credit institutionalises, banks and capital providers increasingly form partnerships that leverage their respective strengths, it said. Banks often originate and service loans, while private credit […] The post Proskauer: Three risks to mon…

The Rise of Private Credit

Written by Sameer Chowdhry Introduction Since the global financial crisis, private credit, which refers to loans made by non-banks, has been one of the fastest growing segments of the financial system. Once valued at $250 million in 2010, the asset class is currently valued at nearly $2 trillion – roughly the same size as the high-yield bond market. Once an afterthought, it has now become a major source of consideration for companies seeking fin…