How Banks and Private Credit Became the Best of Frenemies

Odd Lots

Bloomberg

News, Investing, Business, News Commentary, Business News

4.4 • 1.6K Ratings

🗓️ 24 October 2024

⏱️ 48 minutes

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Summary

By now, everyone knows that private credit is a hot market. What's less known is that banks want in on it too. It's an odd state of affairs given that both these entities are in the business of making loans, so in theory they should be competing against each other. But instead we're seeing a bunch of deals, with more than a dozen big banks teaming up with private credit over the past year. So why are two seemingly natural competitors joining forces? And how much of an existential threat does private credit really pose for the banking industry? On this episode, we with speak with Huw van Steenis, vice-chair at Oliver Wyman and a long-time bank analyst at Morgan Stanley, about this new dynamic.

Read More:
The Macro Impact of the Private Credit Boom
The Black Hole of Private Credit

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Transcript

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0:00.0	As a real estate manager, principal asset management harnesses the power of a 360 degree perspective,
0:05.7	delivering local insights and global expertise across public and private equity and debt.
0:11.2	Their teams apply local insights and global perspectives to help
0:14.4	identify the most compelling investing opportunities. Principal
0:17.9	Asset Management actively invested. Learn more at Principal AM.com. Investing involves risk including possible loss of
0:25.9	Principal Asset Management SM is a trade name of Principal Global Investors
0:30.3	LLC. all night on where the race stands straight to your podcast feed.
0:44.1	Georgia, neck and neck, other states, Kamala Harris in the lead.
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0:51.4	This race is still very very close.
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0:56.2	Get it on your smartphone with Apple Podcasts, Spotify, or anywhere you get your podcasts. Bloomberg Audio Studios.
1:07.0	Podcasts, Radio News. Hello and welcome to another Wiesenthal.
1:25.0	I'm Tracy Allaway.
1:26.0	And I'm Joe Wiesenthal.
1:27.5	Joe, I feel like I start every private credit episode with the same point.
1:32.0	But I mean, private credit credit it's everywhere right now. I think I counted
1:35.8	like dozens and dozens of stories on private credit that came out just on the Bloomberg in the past week.
1:42.8	There's two funny things that are going on which is one private credit
1:46.8	so these non-bank entities providing loans etc.
1:50.4	Wanting to get into credit and there's more and more about that every day and then there's banks wanting to get into credit and there's more and more about that every day and then there's
1:53.8	banks wanting to get more and more into private credit which is the zone thing of
	...

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