S&P Global Market Intelligence's New Outlook Report Shows the Convergence of Public and Private Credit Markets and Expects the Trend to Continue into 2025

Rhea-AI Summary

S&P Global Market Intelligence has released a report highlighting the convergence of public and private credit markets in 2024 and its expected continuation into 2025. The report reveals that while public debt markets have grown, the $1.5 trillion private markets continue rapid expansion. Key findings show that Credit Default Swap (CDS) credit events have remained low, with only two credit event auctions in 2024. The private credit market is projected to double by 2028, though regulators and investors are calling for increased oversight in this largely unregulated space. The report notes that companies now have unprecedented access to private credit sources, potentially affecting credit risk transparency.

Positive

• Private credit market continues strong growth, currently at $1.5 trillion
• Private credit assets under management expected to double by 2028
• Low number of credit default events indicating market stability

Negative

• Increasing regulatory scrutiny and calls for more oversight in private credit markets
• Concerns about transparency and measurement of credit risk in private credit funds

NEW YORK, Nov. 21, 2024 /PRNewswire/ -- S&P Global Market Intelligence has released a report today highlighting the convergence in public and private credit markets. The newly published Public and Private Markets Outlook: Converging on Credit is part of S&P Global Market Intelligence's Big Picture 2025 Outlook Report Series.

In this new report, S&P Global Market Intelligence's capital markets analysts highlight how public and private credit markets have become increasingly intertwined in 2024, and why we expect this trend to continue in 2025. Public debt markets have grown, but not at the expense of the $1.5 trillion private markets, which continue their rapid expansion.

"It may be no coincidence that the fall in Credit Default Swap (CDS) credit events aligns with the growth in provision of private credit. Many companies now have recourse to lines of credit from private sources to an extent not seen in previous cycles. This trend is likely to continue in 2025 but may raise questions about the transparency and measurement of credit risk in private credit funds, where the exposure is ultimately shifted," said Gavan Nolan, Executive Director at S&P Global Market Intelligence.

Key highlights from the report include:

• The $1.5 trillion global private market continues to see new activity as banks seek out new partnerships. Meanwhile, fund managers are trying to enter public markets through new investment vehicles.
• Credit events in the CDS market have stayed low, with just two credit event auctions — the settlement mechanism for CDS — in 2024. This is the fourth consecutive year that auctions have not exceeded three annually and brings the 3-year moving average down to the lowest levels not seen since the credit bubble before the global financial crisis in 2007-2008.
• With the size of the private credit market approaching $2 trillion, some regulators and investors are calling for more rules and transparency in the largely unregulated space.
• The private credit market, meanwhile, is only growing, with some estimates calling for total assets under management to more than double by 2028.

To request a copy of Public and Private Markets Outlook: Converging on Credit, please contact press.mi@spglobal.com.

S&P Global Market Intelligence's opinions, quotes, and credit-related and other analyses are statements of opinion as of the date they are expressed and not statements of fact or recommendation to purchase, hold, or sell any securities or to make any investment decisions, and do not address the suitability of any security.

About S&P Global Market Intelligence 
At S&P Global Market Intelligence, we understand the importance of accurate, deep and insightful information. Our team of experts delivers unrivaled insights and leading data and technology solutions, partnering with customers to expand their perspective, operate with confidence, and make decisions with conviction.

S&P Global Market Intelligence is a division of S&P Global (NYSE: SPGI). S&P Global is the world's foremost provider of credit ratings, benchmarks, analytics and workflow solutions in the global capital, commodity and automotive markets. With every one of our offerings, we help many of the world's leading organizations navigate the economic landscape so they can plan for tomorrow, today. For more information, visit www.spglobal.com/marketintelligence.

Media Contact
Amanda Oey
S&P Global Market Intelligence 
+1 212-438-1904 
amanda.oey@spglobal.com or press.mi@spglobal.com

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SOURCE S&P Global Market Intelligence

FAQ

What is the current size of the global private credit market according to S&P Global (SPGI)?

According to S&P Global Market Intelligence's report, the global private credit market is currently at $1.5 trillion.

How many CDS credit event auctions occurred in 2024 according to S&P Global (SPGI)?

According to the report, there were only two credit event auctions in 2024.

What is the projected growth for private credit assets under management by 2028?

According to the report, private credit assets under management are expected to more than double by 2028.

What are the main concerns regarding private credit markets highlighted in S&P Global's (SPGI) 2025 outlook?

The main concerns highlighted are the need for more rules and transparency in the largely unregulated private credit space, and questions about credit risk measurement in private credit funds.