The US Treasury is to meet domestic and international insurance regulators over the risks in private credit after recent upheaval in the multitrillion-dollar market.
Initial meetings “will allow participants to survey recent market events, emerging risks, risk management practices and outlooks for the sector”, the department said.
The move signals growing concerns in Washington about the health of the private credit sector and its rapid growth. The insurance sector, which is largely regulated in the US at a state level, has become increasingly intertwined with the private capital sector over the past decade.
The trend has prompted greater concern from regulators because of the opaqueness, illiquidity and complexity of private credit products when compared to more traditional portfolios of government and corporate bonds.
