Annual asset growth in leveraged finance universe by lender type
Today’s chart of the week highlights a key trend in global private capital fundraising. Explore this insight and more in our midyear private markets outlook, “Follow the value, not the herd.”
- Private credit’s rapid expansion over the past decade has some market participants concerned about the possibility of excess capital inflows and the risk of a market bubble.
- Yet, its growth has primarily resulted from private credit strategies taking market share from banks and public markets, not a marked increase in the overall debt pie. Current fundraising levels (dark blue column at right) are generally in line with expected demand, not pointing to overcapacity.
- While public issuance has improved in 2025, the traded corporate credit market (high yield bonds and leveraged loans) has not grown since early 2022. Meanwhile, bank lending continues to grow at a slower rate than nominal GDP.
- The size of the overall leveraged credit market has remained consistent relative to the size of the economy, refuting the notion of a credit bubble. Rather, private lenders continue to take share from public markets and banks as borrowers value private transactions for their flexibility and reliable execution.
- Private credit faces risks—tariff policy, spread tightening amid higher competition in large-cap deals and an uncertain economic outlook. Yet oversupply does not appear to be one of them.