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RE: LeoThread 2025-05-30 12:16

in LeoFinance4 months ago

Part 3/8:

The Scale of Private Credit Market

To gauge the impact of private credit, one must consider the sheer scale of investment flowing into this sector. Recent reports indicate that approximately $1.7 trillion has been raised for private credit in recent years. This influx has, in some cases, outpaced the availability of high-quality borrowers. As private credit continues to evolve, there are worries that the potential expansion to beyond $3 trillion in raised capital may lead firms to lower their borrowing standards. This could result in loans to less creditworthy entities without adequate collateral, raising the stakes for banks that provide liquidity for these transactions.

Lessons from Past Financial Crises