In the $3 trillion private credit market, the ‘shadow default’ rate is increasing as more money chases lower-quality deals

Fortune

by Jim Edwards

February 22, 2026

AI-Generated Deep Dive Summary

The private credit market, valued at $3 trillion, is experiencing a rise in 'shadow default' rates as investors increasingly pursue lower-quality deals. This trend reflects a growing number of companies facing unexpected financial difficulties midway through their agreements, with the shadow default rate jumping from 2.5% to 6.4%.

Verticals

businessfinance

Originally published on Fortune on 2/22/2026