Credit Markets Wobble as Loan Losses Revive Bank Fears (1)

Global credit markets are on edge as fresh loan blowups fuel credit risk concerns and stir memories of the 2023 US regional banking crisis.

US high-yield and leveraged-loan funds each had $1.3 billion of outflows in the latest week, the most in six months, according to LSEG Lipper, a sign that investors are readjusting their holdings of higher-risk debt. Spreads on high-grade corporates, though still tight, have widened 0.05 percentage point this month to 0.79 percentage point.

Credit markets, already jittery after a few worrisome corporate collapses, were further roiled Thursday after Zions Bancorp and Western Alliance Bancorp said ...