JPMorgan Chase CEO Jamie Dimon attends the American Business Forum on Thursday, November 6, 2025 in Miami, Florida, USA.
Eva Marie Uzcategui | Bloomberg | Getty Images
JPMorgan Chase & Co. is reducing its exposure to the private credit industry by lowering the value of loans held as collateral by banks, according to people familiar with the move.
The bank’s huge Wall Street trading arm has written down the value of loans in private credit clients’ loan portfolios, most of them to software companies, said the person, who asked not to be identified discussing customer communications.
JPMorgan’s move signals that the nation’s largest bank by assets wants to get ahead of potential disruptions over private credit lending to software companies. Chief Executive Jamie Dimon, who has guided the bank through multiple crises during his two decades as head of JPMorgan, is known for constantly reminding executives about the risk that borrowers won’t be able to repay their loans.
Software companies have come under intense scrutiny in recent months as model updates by OpenAI and Anthropic raise concerns that some providers will be disrupted by AI. The concerns have triggered a downcycle for private credit companies, as retail investors have pulled out their money in recent weeks, leading to unusually high redemptions at companies such as Blue Owl and Blackstone.
This adjustment was made in JPMorgan’s lending business. Private credit companies borrow funds using so-called “back leverage” to amplify the returns on their funds. The business is considered relatively risky, as it is highly leveraged and losses are magnified if the underlying loans deteriorate.
By lowering its leverage collateral, JPMorgan is reducing the ability of private credit companies to borrow on loans, and in some cases may even force companies to post more collateral.
It was not possible to determine the size of the loans affected or the extent of JPMorgan’s price cuts.
JPMorgan could become the first major bank to take such a step, according to the FT, which first reported the bank’s price cuts.
The move was a preemptive move driven by changes in market valuations rather than actual loan losses, bank officials said, characterizing the move as financial discipline “rather than waiting until a crisis hits.”
JPMorgan previously deleveraged the industry early in the coronavirus pandemic, the person said.
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