The Financial Stability Board issued a report stating that the rapidly growing private credit sector, along with its deepening links with traditional banks and asset management companies, poses risks to the global financial system. The body warned that some broader indicators show an upward trend in defaults.The report noted that private credit is showing signs of potential stress, including rising default rates, while a lack of transparency presents challenges for both regulators and investors. It specifically highlighted that the retailization of private credit, particularly in the United States, could amplify risks.Related NewsUnemployment Rate for Apr in United States is 4.3%, unchanged from its last period. The forecast was 4.3%.Based on 2024 data, the institution estimated the overall private credit market size at between USD1.5 trillion and USD2 trillion. The Alternative Investment Management Association estimated the figure at USD3.5 trillion. (fc/j)
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