US Banks’ Exposure to Private Equity Surges—Experts Warn of Potential Contagion

Following the bankruptcies of subprime auto lender Tricolor and auto parts supplier First Brands Group, which rattled the credit markets, a Moody’s report has sounded the alarm over U.S. banks’ high exposure to private equity and private credit.

U.S. banks’ exposure to private equity has reached $300 billion, Moody’s Investors Service revealed in an Oct. 21 report.