Warren Demands Private Credit Stress Test After Big Bankruptcies

US Senator Elizabeth Warren is urging regulators to scrutinize the burgeoning private credit market, warning that implosions of Tricolor Holdings and First Brands Group are “likely the tip of the iceberg” in terms of bad debt held by Wall Street’s biggest banks.

In a Thursday letter, Warren and Senator Jack Reed demanded that top cops at the Federal Reserve and Federal Deposit Insurance Corporation push Treasury Secretary Scott Bessent to conduct a stress test that evaluates the “the size, scale, scope, interconnectedness, and mix of activities of the private credit market” in the US.

The $1.7 trillion private credit industry, ...