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JPMORGAN CHEE has been hit by the exertion of the regulator to understand the depths of the bonds between banks, the redemption companies and the fast -growing private credit sector, refusing to discover their borrowing in the area of increasing systemic concern.
The US banking regulators have imposed a deadline of February 4 for lenders who will discover their exposure at the end of the year with different types of “Nebanic Financial Institutions” to “Best Hurry”. Banks have by the end of the second quarter to be fully in accordance.
Bank of America, Citigroup, Goldman Sachs, Morgan Stanley and Wells Fargo provided decaying their loans, providing a window to the scope of the major banks with a growing but still opaque part of the financial system.
However, US Bank’s largest bank has marked all $ 133 billion with a loan non-banks as a “other” in its three-month report submitted by a federal deposit insurance corporation, not to break it down the type of borrower. This amount is greater than the total loans of all, except for the hand of the largest banks in the country.
A person familiar with the JPMORGAN decision said the bank believed that there was a “operational risk” in reporting their loan categories in one way to FDIC and the other to the Federal Reserves, which stuck with previous reporting requirements and guidelines for discovering loans non-banks. The FDIC refused to comment.
Regulators have requested more information on exposure to banks of non -banking financial institutions as the sector has increased and the potential for wider systemic risks has increased.
The loan loans were almost 1.2 to $ 1,2ntn at the end of 2024, which persisted with mortgage loans for commercial real estate programmers and loan card loans, according to FDIC data analysis by Bankredat aggregator.
“The non-Branci has become some of the most important and potentially risky borns of large American banks,” said Viral Acharya of the Stern School of Business School of New York. “He is currently the only one who has a picture of how risky it is, it’s a Fed and just the banks that test the test.”
Bank loans to “financial companies that are not deposits” have increased with just over $ 50 billion in 2010, according to the US Fed data. The Central Bank said this month that she would introduce an analysis of Nebanic financial institutions and risks that could represent the largest banks in the country as part of this year’s stress tests.
Direct lenders and private credit funds often borrow companies that are desirable and can have difficulty in loan from traditional banks. The vessel part of the money to create these loans may increase the return of its investors, but also increases the risk of the financial system.
Even excluding JPMORGAN from FDIC data, new publications show that private loan funds and private capital have become a big borrower from traditional banks. US banks have reported $ 214 billion of outstanding loans with credit funds and other direct business bans and another $ 200 billion in private capital funds, data show.
The terms companies within the orbit of private capital will be higher, as the figures do not include lending portfolio companies.
I reported the Wells Fargo about $ 91 billion loans to private credit companies and private capital funds in late 2024 in my FDIC applications. This was more than any other bank, and more than $ 10 percent of $ 887 billion in total loans at the end of last year.
“We still think it is a limited risk of banks in terms of financial stability,” said Julie Solar, an analyst from Fitch Rating. “But as a private loan is still growing and developing, you have a question of how banks manage that risk.”
