Matt Levine’s Money Stuff: Banks Aren’t Worried About BDCs

Banks and private credit

It is bank earnings week, and people are worried about private credit. You could imagine banks gloating. “People are worried about the credit quality of private-credit loans,” they might say, “and are rushing to take money out of retail private credit funds. We, meanwhile, never got caught up in the private credit hype cycle, and we have a fortress balance sheet and access to lots of cheap funding. This is a great opportunity for us: As private credit cools down and retreats from making aggressive loans, pricing will get more favorable and we will gain market ...