Fitch Ratings policy risks cloud U.S. credit outlook

Fitch Ratings policy risks cloud U.S. credit outlook

The U.S. credit market is facing potential headwinds as Sen. Elizabeth Warren has called for increased scrutiny of private-credit products. In a series of letters sent to S&P Global Ratings, Moody’s Ratings, and Fitch Ratings, Warren requested detailed information on how these agencies assess the riskiness of private-credit products [1].

Warren's concerns stem from the rapid growth of the private-credit market, which has seen a significant increase in the amount of money lent to private-equity-backed enterprises. This market, valued at approximately $700 billion in 2024, has grown over 100 times since 2006 [1]. The booming market has led to concerns about its potential vulnerabilities, such as lack of transparency and its ties to banks and other institutions [1].

The CEO of JPMorgan Chase, Jamie Dimon, has expressed concerns about the private-credit market, comparing it to the mortgage market before the 2008 financial crisis. Dimon has dedicated $50 billion in capital towards providing debt financing for clients in the private credit market [1]. Despite these concerns, some investors have voiced skepticism about how private-credit products are rated, noting that firms can choose their rating providers [1].

The Trump administration is also expected to make it easier for regular people to invest in private credit, potentially increasing the market's size and complexity. An executive order may facilitate the inclusion of private assets in 401(k) retirement plans [1].

Fitch Ratings, one of the agencies under scrutiny, recently confirmed the long-term borrowing rating of Akropolis Group as BB+ with a stable outlook for the fifth consecutive year [2]. This positive assessment reflects the company’s financial robustness and strong market position. However, the broader implications for the U.S. credit market remain uncertain, as the private-credit market continues to evolve and attract more investors.

References:
[1] https://www.cryptopolitan.com/sen-warren-letters-to-sp-global-moodys-fitch/
[2] https://www.globenewswire.com/news-release/2025/07/14/3115026/0/en/Akropolis-Group-has-maintained-the-credit-rating-from-Fitch-Ratings-with-a-stable-outlook-for-five-years-in-a-row.html