Banks are financing and investing in ever more private equity, private credit type investments since the beginning of 2025, according to regulatory filings and news articles.
Regulators have been loosening up bank regulations.
And the largest US banks like JPMorgan, Bank of America, Citigroup, Wells Fargo started writing cheques for billions, in some cases for tens of billions of USDs to finance leveraged buyouts and multi billion USD deals.
The leading banks with large investment banking operations Goldman Sachs and Morgan Stanley are putting up their own capital and capital from the assets they manage on behalf of clients and newly raised by them funds into private equity type deals more and more.
All this loads the financial, banking system with leverage, since private equity investments are in essence leveraged investments and so is in fact private credit high interest loans, which JPMorgan, Bank of America, Citigroup, Wells Fargo, Goldman Sachs and Morgan Stanley are giving out more and more.
The financial system is becoming riskier and more leveraged, according to Wolfteam Ltd.s projections and estimates. But for now regulators and the banking system itself seems to have things under control.
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