Bank of America announced a $25 billion commitment of its own balance‑sheet capital to private‑credit transactions, positioning the bank to compete with non‑bank lenders in a market that has grown to roughly $1.3 trillion in early 2026 and is projected to exceed $3 trillion by 2028.
The move is part of a broader trend of banks filling gaps left by regulatory constraints on traditional lending. By deploying capital in private credit, BofA seeks to diversify income, enhance net‑interest income and fee revenue, and capture higher‑yield opportunities that can offset the lower yields in the broader fixed‑income environment.
Management has underscored the strategic intent behind the commitment. Anand Melvani was appointed head of private credit and Scott Wiate will oversee structuring and underwriting, signaling a dedicated focus on this asset class. The initiative will be managed through the capital markets unit of the investment‑banking division, with no immediate impact on the Global Banking or Global Wealth & Investment Management segments.
In the competitive landscape, JPMorgan has already committed $50 billion to private credit, while Goldman Sachs has expanded its involvement through its asset‑management arm. BofA’s $25 billion commitment places it in direct competition with these peers and with non‑bank lenders that are rapidly increasing their private‑credit presence.
The private‑credit market faces heightened scrutiny over valuations, asset quality, and liquidity, especially in the event of an economic slowdown. Nevertheless, the higher yields and speed of execution that private credit offers provide a compelling tailwind for BofA, which signals confidence in the credit quality of the assets it will acquire.
Overall, the commitment represents a strategic pivot toward higher‑yield, higher‑risk assets that can broaden BofA’s income base and strengthen its competitive position in a market that is expanding faster than traditional lending channels.
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