Marco Werman

It follows a surge in redemptions from the funds and a rise in troubled loans in the industry.

The queries by Fed examiners are intended to assess the level of stress in the private credit industry and the potential for it to spill over to the wider financial system.

The central bank has been seeking details on the debt private credit funds have taken on from banks.

In good times, that debt can juice returns and make private credit funds more enticing.

In bad times, it risks exposing banks to losses.

Ed Kolegi, Bloomberg Radio.

And I'm Marco Werman.

We're now with you hosting The World together.

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Trump administration officials have encouraged the banks to use mythos internally to detect vulnerabilities.

So far, JPMorgan Chase is the only bank named as part of an initiative to test the model, but other major financial institutions such as Goldman Sachs, Citigroup, Bank of America, and Morgan Stanley have also gained access or expect to in the coming days.

Bloomberg News had reported Thursday that earlier this week, Treasury Secretary Scott Besant and Federal Reserve Chair Jerome Powell summoned Wall Street leaders for an urgent chat to warn that they should take the mythos model seriously.

Dan Schwartzman, Bloomberg Radio.

And I'm Marco Werman.

We're now with you hosting The World together.

More global journalism with a fresh new sound.

You're used to hearing my voice on The World, bringing you interviews from around the globe.

And I'm Marco Werman.

We're now with you hosting The World together.

More global journalism with a fresh new sound.