Private Credit Risk Is Worse Than You Think Says Jamie Dimon

Dimon Adjusts Private Credit Concerns

JPMorgan Chase CEO Jamie Dimon has renewed his caution about private credit, highlighting that losses in the sector could be worse than many anticipate, according to Globe St. Speaking at an Oslo conference, Dimon noted the rapid growth and crowded field—more than 1,000 firms—as vulnerabilities if economic conditions abruptly change.

Dimon pointed out that an unusually long stretch without a credit downturn has masked underlying issues in private credit underwriting. He stated that when a credit cycle turns, “it will be worse than people think” in private credit, though not catastrophic.

Signs of Stress but No Systemic Risk

Dimon’s comments mark an evolution from earlier, sharper warnings. He now frames private credit within the context of the much larger $13T US investment-grade bond and residential mortgage markets. In his 2025 shareholder letter, Dimon emphasized that private credit’s market share is not substantial enough to present systemic risk, even though vulnerabilities exist within some firms.

Recent failures of companies like First Brands and Tricolor Holdings remain cautionary signals, but Dimon believes fallout will likely be uneven and contained, rather than threatening the stability of the broader financial system. At the same time, rising refinancing pressure and growing risk exposure across commercial real estate lending are adding another layer of concern for credit markets.

What’s Next for Private Credit

Market participants in private credit should evaluate underwriting standards and prepare for potential losses if economic conditions worsen. While the sector may experience outsized stress compared to banks or public markets, Dimon’s latest outlook suggests that broader contagion is unlikely, reaffirming a more tempered, but still cautionary, perspective.