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JPMorgan Chase
is reducing its exposure to the private credit industry by marking down the value of loans held by the bank as collateral, according to a person with knowledge of the moves.
The bank’s giant Wall Street trading division has reduced the value of loans — most of which were made to software firms — sitting within the financing portfolios of private credit clients, said the person, who declined to be identified speaking about the client interactions.
JPMorgan’s move indicates the biggest U.S. bank by assets wants to get ahead of potential turbulence involving private credit loans to software companies. CEO Jamie Dimon, who has guided his bank through multiple crises in his two decades atop JPMorgan, is known to constantly remind his executives about the risk that borrowers won’t be able to repay their loans.
