One of private credit’s favorite fund structures has emerged as a new battleground for traders and Wall Street executives looking for
Publicly traded business development companies, which bundle private credit loans in a fund that can be traded like stocks, are getting hit in the wake of the bankruptcies of Tricolor Holdings and First Brands Group. That’s reigniting fears about underwriting standards and valuations across the $1.7 trillion private credit industry.
While Tricolor and First Brands both raised significant financing in the public markets and were backed by banks, problems for both companies originated ...