Why is private credit growing so fast? Is it a risk to financial stability?

Thursday, April 4, 2024, 1:30 – 2:30 p.m. EDT
The Brookings Institution, Falk Auditorium, 1775 Massachusetts Ave. NW. Washington, D.C.

Private credit (also known as direct lending) is lending by non-bank financial institutions including private equity firms and alternative asset managers. This alternative to traditional bank loans is most often utilized by small and mid-sized businesses, which are often highly leveraged and generally cannot borrow in corporate bond markets. Although private credit is a small slice of overall business financing, it has been growing very fast, raising concerns among some banks about the competition and among some regulators about risks to financial stability.

On Thursday, April 4, at 1:30 p.m. EDT, the Hutchins Center on Fiscal & Monetary Policy will discuss the reasons for the rapid growth of private credit, the implications for banks and borrowers, and whether private credit could pose a financial stability risk, with four experts who bring different perspectives to the issue.

Viewers can ask questions of the panelists by emailing events@brookings.edu or on X/Twitter using the hashtag #PrivateCredit.

Registration is required to attend an event in person and guests at Brookings are required to attest to their state of health before attending. Visitors may not enter the building if they are feeling ill for any reason, have any symptoms commonly associated with COVID-19, or have tested positive for COVID-19 at any time in the preceding 5 days or longer in accordance with current CDC guidance, or have been advised by their healthcare professional or otherwise to not enter any space where some persons may not be vaccinated.
.