Wall Street Banks Fuel Private Credit Boom with 145% Lending Surge
Traditional banks are writing a new playbook in corporate finance. JPMorgan Chase and peers have extended $95 billion in credit lines to private debt vehicles—a 145% surge that blurs the line between collaborators and competitors. The MOVE effectively bankrolls the expansion of firms like Blackstone and Ares Capital while preserving regulatory advantages for lenders.
Revolving credit facilities dominate this shadow financing system, accounting for $79 billion of the total. "Banks get better capital treatment on these highly secured loans and earn healthy returns," notes Harvard’s David Scharfstein. The arrangement creates a symbiotic relationship where Wall Street profits from private credit’s rise even as it loses market share in direct lending.
