Financiers fret over ‘leverage on leverage’ in private credit

TO some elite financiers who gathered in Los Angeles for the Milken Institute conference, a debt binge in private markets is reminding them of the go-go days of risk-taking before the 2008 financial crisis.

In the halls of the Beverly Hilton and at meetings around town last week, I spoke with more than a dozen investors, bankers and fund managers involved in the booming US$1.7 trillion private credit market, where investment funds lend private equity portfolio businesses and other companies money.