The Federal Reserve Board published a note using newly published U.S. Financial Accounts data to estimate that U.S.-domiciled private credit vehicles held approximately USD 1.9 trillion in assets at the end of 2025, up 21% from 2024. The analysis highlights substantial differences in loan exposure, leverage and liquidity across vehicles. Its measure covers total vehicle assets rather than private credit loans alone and excludes direct holdings of loans or privately placed debt securities by banks, insurers and other institutional investors.
Private debt funds were the largest category at USD 940 billion, followed by business development companies (BDCs) at USD 570 billion. Growth was particularly rapid among BDCs and interval and tender offer funds, whose assets increased by 30% and 39%, respectively, in 2025. Private credit loans represented about 80% of BDC assets, compared with 57% for private debt funds and 26% for interval and tender offer funds. Collateralized loan obligations backed by middle market loans invested exclusively in private credit loans.
Average ratios of debt to equity remained relatively stable in recent years but differed considerably across structures, at around 1 for BDCs, 0.25 for private debt funds and 0.05 for interval and tender offer funds. Banks provided most debt financing across these categories. Regulatory constraints, redemption obligations and investor composition help explain the differences in leverage and portfolios. Private debt funds generally lock up investor capital until termination, limiting redemption pressures. By contrast, recent redemption pressures at perpetual nontraded BDCs highlight the liquidity challenges of offering periodic investor withdrawals while holding illiquid loans.