JPMorgan Chase (JPM, Financial) is significantly expanding its direct lending business by allocating an additional $50 billion to capture a larger share of the rapidly growing market. Since 2021, the bank has invested over $10 billion in more than 100 private credit transactions from its balance sheet. This new commitment builds upon those efforts. JPMorgan has partnered with several syndicated loan collaborators who have contributed nearly $15 billion to this initiative.
Troy Rohrbaugh, co-head of JPMorgan's commercial and investment banking, and Kevin Foley, global head of capital markets, expressed confidence in the current environment and risks, indicating a willingness to allocate this substantial amount. They noted that if the bank reaches this figure and sees the need to continue, it has the capacity to do so.
Last year, JPMorgan spent considerable time assembling the initial team for its syndicated loan program. The loans are initiated by JPMorgan and co-invested with other companies. The team currently includes seven firms, such as FS Investments, Cliffwater, Shenkman Capital Management, and Octagon Credit Investors, alongside fund management companies.
JPMorgan's major banking competitors are also exploring the private credit sector. Citigroup announced a partnership with Apollo in September to collaborate on $25 billion worth of deals over the next five years. Wells Fargo launched a $5 billion direct lending fund with Centerbridge Partners in 2023.
