A recent joint analysis of large syndicated loans urged banks to improve their risk management, even though evidence suggests that nonbanks, not banks, hold the higher share of risky leveraged loans.
Despite a generally positive picture in the Shared National Credit report, regulators warned that underperforming loans in the the portfolio remain elevated.
The amount of debt owed by businesses and the valuations of corporations are elevated, creating a growing source of concern, the Federal Reserve said Wednesday.
Sen. Elizabeth Warren said regulators are failing to respond to what she thinks could be a new meltdown in the making: the trillion-dollar market for leveraged loans.
While they won’t be in position to enact legislation, House Democrats could use their newfound power to spotlight issues that Republicans have largely ignored, including the exploding levels of corporate debt.
If approved, the Fed would consider risk factors besides size in how strenuously it oversees individual banks; Capital One's CIO on operating a bank as a technology company.
The Federal Reserve is getting more concerned about risks from the leveraged loan market, with a key official saying it's now taking a "closer look" at whether banks are chasing deals without adequately protecting themselves against losses.
