Bank of England speech explores risk in private markets

Published: 22 April 2024

On April 22, Nathanael Benjamin, executive director at the Bank of England, delivered a speech discussing the relationship between private credit and private equity, and how interconnected risks and challenges inform the Bank of England’s approach to the private markets.

The speech draws attention to how private credit funds often provide direct loans to companies owned by private equity funds, positioning them as both competitors and collaborators within the private equity landscape.

The discussion emphasises the interconnected financial stability risks posed by the intertwined operations of private credit and private equity. These include concerns over leverage management, a desire for greater loan level data, and concerns over the impact of the significant growth of private markets. The speech identifies this interconnectivity as crucial in understanding the broader financial dynamics and potential systemic risks within the market.

For further information please contact Nicholas Smith ([email protected])