UBS Warns Private Credit Defaults Could Reach 15%
UBS warns private credit default rates could climb to 15% in a stressed scenario, significantly above historical averages. The bank highlighted that rising defaults may prompt valuation repricing and higher provisions across private credit portfolios.
1. UBS Forecasts Sharp Rise in Private Credit Defaults
UBS modeled a worst-case scenario where private credit default rates reach 15%, driven by tighter lending standards and an economic slowdown. It cautioned that such a surge would necessitate valuation adjustments and boost provisioning levels across private credit portfolios.
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