Jamie Dimon Scored a Win in the Debate Over Private Credit Risks – ryan

The CEO of America’s Larger Bank Has Long Been Skeptical of the Rise Private Credit, Event As Jumps on the Nonbank Bandwagon in an Efffort.

“Think that People who have haven’t been through Major Downturns are missing the point About What Can Happen in Credit,” Jamie Dimon Said at the Bank’s Investor Day in May.

This Week, Dimon’s Concerns were Bolstered by A Report Issured by Moody’s Analytics, a forms Advisor to the Treasury Department, and a Securities and Exchange Senior Economist. The Report Warned That The Growing Practice of Raising Money From Institutional Investors to make May a “Locus of Contagion” During A Funde Financial Crisis.

The Report Raised Concerns About What It Called The Industry’s Growing “Interconnections” Across Industries from Banking to Insurance.

“The Same Institutional Investors, Say an Insurance Company or a sovereign wealth end, Might Hold Stakes in Private Credit Funds, Clos, and Public Corporate Bonds,” The Report Said, Adding: “IF Losses Occur in One Investment, That Investor May Be Force to Liquidate ELSETER, propagating stress. ”

At a conference Last May, Dimon Said that there “Could be hell to pay” if the private credit sector, saying it reminds Him a “Little bit” of the mortgage industry.

Private Credit Investors, Like Apollo Ceo Marc Rowan, have argued that the new model is actually making the financial system safer.

“Jamie is an amazing representative of the Banking Industry,” Rowan Said the Day after Dimon’s Comments Last May, we were was asced about. “But Everyone Dollar That Moves Out of Banking Industry and Into The Investment Marketplace Makes the System Serfer and More Resilient and Levered.”

The private credit industry is Still Much Smaller than Banking, and does “Not yet appears to be systemically important,” The Report Said, Adding that “It Could Dispropportation Amplify a Future Crisis.”

The Report Listed Regulatory Recommendations that Could Soften the Potential Impact of A Private-Credit Crisis, Such as Increas Stress-Testing of Large Funds, Transparency and Data Reporting, and Limits or Guidelines on Leverage at Certain Funds.

In other Words: Private Make Credit Funds a Bit More Like Banks.

“The Objective is not to Stifle the Beneficial Innovation of private Credit provides but to shine a light on its risk and links like a rapidly gowing part of the corporate finance, and potentially other sectors, does not become a blind spot,” The Report Said.