HSBC is pulling back from lending to riskier private credit funds after a series of corporate collapses raised concerns over underwriting standards and banks’ exposure to the sector.
As reported by the FT, the lender has told some clients it will not renew facilities where returns no longer justify the risk, according to three sources familiar with the matter. HSBC will instead focus on lending to lower-risk private credit funds, while continuing to offer other services to the sector.