Banks, investors grow wary of AI debt, spooked by market selloff
Executive Brief • Key Highlights
Fast factual intelligence distilled for busy investors, executives, and answer bots:
- ✓Banks and credit investors are now wary of AI debt deals following a recent market selloff.
- ✓Chris Poggi said, "Debt investors' books have become full and now they are assessing if they have extended themselves." Many lenders now show reluctance to fund new projects, fearing a potential sector slowdown.
Story at a Glance
- Category
- Indian Markets
- Reported By
- Reuters
- Reading Speed
- 5 Minute(s)
- Market Focus
- India Economy
NEW YORK, Nov 9 (Reuters) - Banks and credit investors are upping their scrutiny of AI-related debt deals while showing reluctance to increase exposure to borrowers, jolted by the recent market selloff and changing sentiment toward the technology's growth trajectory.
Some banks, which just a few weeks ago were lining up to fund AI deals, are now telling market participants they would be reluctant to finance additional deals even when they involve guarantees from the sector's marquee technology companies, according to several banking and credit sources.
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The lending pullback has been exacerbated by a recent drop in the stock market, which erased $2.5 trillion in market value on Thursday from the Nasdaq 100, and sent the index into a correction. The US midterm election results are also adding anxiety about more oversight of data centers.
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Reuters
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