Bloomberg Businessweek Private Credit’s ‘Back Leverage’ Is Another Pain Point for Funds
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Mar 13, 2026 
Chris Whalen, former banker and risk analyst and chairman of Whalen Global Advisors, breaks down private credit turmoil. He talks about banks pulling back lending, retail investors in illiquid funds, and legal structures that shield managers. He also covers valuation quirks, stock hits at big alternative managers, and why these stresses may remain confined to private markets.
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JPMorgan Pullback Is A Market Warning
- JPMorgan's pullback signals wider bank retrenchment from private credit.
- Chris Whalen says JPMorgan is the biggest secured lender so its decision to restrict lending warns of contagion as other banks follow.
Retail Investors Were Sold Illiquid Private Deals
- Private credit firms expanded fees and invited retail investors into illiquid products.
- Whalen argues the industry got greedy, selling unsuitable, non-transparent vehicles protected by NDAs and contract terms that limit investor recourse.
Contracts And SPVs Limit Legal Accountability
- Many private structures are shielded from fraud claims and often non-recourse to banks.
- Whalen cites SPVs and litigation like Western Alliance vs Jeffries to show sponsors can disclaim liability until mass redemptions force buybacks.