Japan’s Mitsubishi UFJ Financial Group is in talks with investors to offload its exposure to about $2bn of loans it extended to listed private credit funds, according to people familiar with the matter.
The transaction would protect the largest Japanese bank against losses if private credit funds failed to repay their debt. It also offers the bank capital relief to free up more capacity for lending and dividend payouts.
The talks come as banks tighten the terms of lending to private credit funds, which have endured a surge in redemptions this year as investors worry AI will ravage the software companies they have financed.
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