Private Credit Managers Step Up Loan Trading as AI Fears Hit Software Exposure

6 articles · Updated · Bloomberg · May 21

Private credit managers are increasingly buying and selling loans to shed troubled positions and snap up discounted debt, a sharp shift for a market where loans rarely changed hands.
AI-driven disruption fears are pushing a number of business development companies to cut software exposure, turning one of private credit’s biggest growth areas into a source of stress.
Other firms are taking the opposite bet, building positions in marked-down loans as the industry faces its first real stress test after years of breakneck expansion.
That pickup in trading signals a more liquid, price-sensitive phase for private credit, challenging the buy-and-hold model that long defined the sector.

As AI devalues software loans, where are private credit's next billion-dollar bargains hiding?

Is private credit's shift to active trading a sign of maturity or a warning of a looming systemic crisis?