The investigation centers on the dual impact of artificial intelligence, which has increased debt through massive infrastructure buildouts while simultaneously disrupting software companies that borrowed from the same markets. JPMorgan has already marked down portions of loans to these threatened software companies, as many new AI projects may take years to generate the cash flow necessary to service their debt.
Wednesday, October 21, 2026
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New York Fed Probes Bank Exposure to Private Credit AI Risk
US Markets15 days ago
JPMorgan, Wells Fargo, Barclays, and Morgan Stanley are being scrutinized by regulators over the quality of collateral backing their loans to private credit firms. The New York Fed has launched the review to determine how much systemic risk from the private credit market has flowed back into the traditional banking system through these institutions.
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