State Street CEO Says Surging Private Credit Demands US Scrutiny

The head of one of the world’s largest asset managers called on financial regulators to step up scrutiny of private credit, which has surged amid the tightening oversight of the banking system.

“What the regulators are going to have to get their arms around is, yes, we’ve taken care of the banks -- we’ve distributed the risk,” State Street Corp. Chief Executive Officer Ron O’Hanley said in an interview Tuesday. “But is it being re-aggregated elsewhere where it’s going to cause, yet again, a systemic problem?”

As banks have restrained their balance sheets since the 2008 global financial crisis, ...