Big banks lost out on billions in fees as direct lenders lured away corporate borrowers. The future of their leveraged lending businesses depends on how they adapt. Now, the banks are trying a new tack to stanch the bleeding: building out direct lending operations of their own. Now banks are hitting up money managers to seed the private credit ventures they’re creating, effectively lining up buyers in advance.
| less than a minute read
Wall Street couldn’t beat private credit. Now it wants a cut
"What will be really interesting is how the partnerships play out if you get into a higher default environment. When people’s backs are up against the wall, and it’s the first time you’re figuring out how to book a default, that’s where the rubber is going to hit the road."
