BofA Allocates $25B to Grow Private Credit Business
Synopsis
Bank of America has committed $25 billion to private credit deals, expanding its direct lending activities. The news was first reported by Reuters, which reviewed an internal memo detailing the plan. The move comes as the global private credit market grows beyond $1.5 trillion in assets. Bank of America reported $26.5 billion in net income for 2024 and holds more than $3 trillion in assets.
Bank of America has committed $25 billion to expand its private credit business, according to a memo reviewed. The funds will support direct lending deals as the global private credit market surpasses $1.5 trillion. The bank reported $26.5 billion in net income for 2024.
Key Highlights
- Bank of America commits $25 billion to private credit transactions.
- Global private credit market exceeds $1.5 trillion in assets.
- Bank posted $26.5 billion net income in 2024.
Bank of America has committed $25 billion to private credit deals, according to an internal memo reviewed by Reuters, which first reported the development.
The allocation will support direct lending transactions arranged through the bank’s capital markets business. Private credit refers to loans made directly to companies outside traditional public bond and syndicated loan markets.
The memo did not outline specific transactions, sectors, or a timeline for deploying the funds.
Private Credit Market Continues to Grow
The move comes as the global private credit market continues expanding. Industry estimates cited by Reuters show the sector has grown to more than $1.5 trillion in assets globally, driven by increased demand for flexible corporate financing.
Companies have increasingly turned to private credit providers as public markets experience periods of volatility and tighter lending conditions. Direct lending allows borrowers to negotiate loan terms privately rather than issuing bonds or arranging broadly syndicated loans.
Other large financial institutions have also expanded in this segment. JPMorgan Chase has set aside $50 billion for direct lending initiatives, while Citigroup has broadened its private credit activities beyond its earlier platform developed with Apollo. Goldman Sachs has raised more than $20 billion for direct lending through its alternative investment division.
Financial Position
BofA reported net income of $26.5 billion for 2024 and ended the year with total assets exceeding $3 trillion, according to its annual results. The bank is one of the largest lenders in the United States.
The memo did not provide further operational details regarding the $25 billion commitment.
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Pooja Malik is a business journalist with over six years of experience covering startups, entrepreneurship, and emerging trends. She has previously worked with leading media platforms such as YourStory Media and BW BusinessWorld, where she reported on business, policy, and market developments. Currently, she serves as Editor at The Inspirepreneur Magazine, where she writes and edits stories across business, lifestyle, and travel, with a focus on clarity, accuracy, and reader relevance.
