There's around $1 trillion of private debt that's headed for potential trouble, Bank of America warned.
Most of that debt has been created by below-investment grade companies through high yield loans or bonds.
The bank estimated around $1 trillion of high yield debt has been accumulated by companies over the past five years, which has largely been created by below-investment grade corporations.
Around 25% consists of below-investment grade firms issuing risky high-yield bonds, while 35% consisted of broadly syndicated loans taken out by below-investment grade companies, the bank said.
The remaining 40% was classified as private debt.
Persons:
Yuri Seliger
Organizations:
Bank of America, Service, Moody's Investors Service
Locations:
Wall, Silicon