Citi Warns of Private Debt Risk as ‘Tourists’ Are Forced to Sell

 

Rookie private lenders that have to sell in a downturn are a potential threat to credit markets, according to Citi. “If the cycle turns and these tourists, rather than working out loans, just start selling them at below the economic value — what happens to the rest of the market?” Mickey Bhatia, the firm’s head of spread products, tells Bloomberg News’ James Crombie and Bloomberg Intelligence’s Sam Geier in this episode of the Credit Edge podcast. “That’s a big worry,” says Bhatia. They also discuss global fund flows, investment in AI infrastructure and expansion of electronic trading to incorporate collateralized loan obligations.

 

The Credit Edge by Bloomberg Intelligence

The Credit Edge reviews the top credit news of the week and looks at the week ahead, with in-depth r… 

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