Deutsche Bank, Europe’s biggest lender by assets, has stopped renewing lending facilities for private credit funds that fail to generate adequate returns. The move signals a meaningful shift in how traditional banks are approaching an asset class that has ballooned in size since the global financial crisis.
The German bank reported roughly €26 billion (about $30 billion) in private credit exposure as of the end of 2025, up from €24.5 billion the prior year. So even as the bank was growing its exposure, it was apparently becoming more selective about which funds deserved the privilege of borrowing its money.
A quiet credit squeeze
Private credit exists in large part because banks pulled back from direct lending after 2008. Regulators made traditional bank lending more expensive, and private credit funds rushed in to fill the gap. Now those same banks that stepped aside are also the ones providing leverage and credit lines to the funds that replaced them.
Deutsche Bank isn’t alone. JPMorgan has also reportedly cut back credit lines to private credit funds following previous markdowns.
