The collapse of Silicon Valley Bank (SVB) has heightened concerns about systemic risk in financial markets. While increased regulatory scrutiny of bank portfolios is underway, some experts suggest a closer examination of private credit could be essential. Private credit allows businesses to borrow directly from investors, bypassing traditional banking channels. This type of borrowing has been growing steadily over the past few years and is expected to reach $1.5 trillion in 2024. As regulators navigate this new landscape, understanding the nature and risks of private credit will be crucial in mitigating potential vulnerabilities.
Source: https://www.realclearmarkets.com/2025/02/20/private_credit_not_a_source_of_systemic_market_risk_1092638.html