Thank you for the enlightening compilation - please could you clarify what you mean here: "This has been a global phenomena and I don’t see this changing unless the new Trump administration slowly shifts bank regulations away from their existing strict stance towards capital."
There has been a focus since the GFC in 07/08 towards stricter banking regulation specifically higher capital requirements. This has led banks to hold much higher capital and regulators to focus on increasing capital requirements for banks. This has been coupled with rules that make it such that banks prefer lending to companies that have collateral or that have a lower risk rating - it's more capital efficient. This has led banks to shift away from lending to mid-market companies globally. Please refer to the Private Credit article.
Thank you for the enlightening compilation - please could you clarify what you mean here: "This has been a global phenomena and I don’t see this changing unless the new Trump administration slowly shifts bank regulations away from their existing strict stance towards capital."
There has been a focus since the GFC in 07/08 towards stricter banking regulation specifically higher capital requirements. This has led banks to hold much higher capital and regulators to focus on increasing capital requirements for banks. This has been coupled with rules that make it such that banks prefer lending to companies that have collateral or that have a lower risk rating - it's more capital efficient. This has led banks to shift away from lending to mid-market companies globally. Please refer to the Private Credit article.