Private credit under scrutiny
Waldron added that the recent volatility and losses may indicate “stress building up at the lower end of the economy,” where heavy borrowing has surged.
The spate of credit fraud scandals has heightened tension between traditional banks and private lenders. Some private credit firms argue that banks are unfairly attacking their business models.
Marc Lipschultz, Co-CEO of Blue Owl Capital Inc., hit back, saying:
“These fraud cases originated in the banks themselves. They should clean up their own books before criticising others.”
Waldron concluded that both private credit providers and banks operate within a single, interconnected financial ecosystem:
“I don’t really understand why we talk about private credit as one thing and bank lending as another — it’s all part of one system,” he said, warning that if financial stress intensifies, “no one will be immune from the fallout.”