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Private credit and NBFI: how to combine financial innovation and systemic resilience?

Private credit and NBFI: how to combine financial innovation and systemic resilience?

Day 3 Morning

Friday 18 September

Location :

ROOM 1

Speakers

Public Authorities
Patrick Amis
Director General, DG Horizontal Line Supervision - Single Supervisory Mechanism (SSM)
Lee Foulger
Director, International - Bank of England
Petra Hielkema
Chairperson - European Insurance and Occupational Pensions Authority (EIOPA)
Takushi Kurozumi
Deputy Director-General, Financial System and Bank Examination Department - Bank of Japan
Francesco Mazzaferro
Head of Secretariat - European Systemic Risk Board (ESRB)
Industry Representatives
John Golden
Global Head of Financial Regulation of Apollo and Athene - Apollo Global Management
Linda-Eling Lee
Founding Director and Head of the MSCI Institute - MSCI
Yann Le Pallec
President - S&P Global Ratings

Session overview

Objectives

Over the past decade, non-bank financial intermediation (NBFI) and private credit have become a central component of the global financial system, reflecting profound changes in financial intermediation, the cumulative effects of post-crisis banking reforms, the growth of institutional savings, and increasing long-term investment needs. This rapid growth of NBFI and private credit is raising increasingly important financial stability questions. The issue is no longer only the size of the sector, but also the way risks are structured, financed, valued and transmitted across the financial system.

The first objective of the session is to assess how private credit and broader NBFI innovation can provide sustainable additional financing to the real economy. The discussion will examine where these financing channels complement banks and capital markets, how they can support long-term investment while preserving sound asset-liability matching, and what conditions are needed to scale market-based finance while maintaining transparency, market discipline and effective risk absorption. Particular attention will be paid to semi-liquid funds, valuation practices, redemption management and financing of innovation-driven sectors.

The second objective is to discuss how public authorities and the industry can strengthen the resilience of private credit and the broader NBFI sector. The session will examine how to improve the monitoring of leverage, liquidity mismatches and interconnectedness, how stress-testing frameworks should evolve, and which supervisory, macroprudential and crisis-management tools are needed to preserve the benefits of financial innovation while limiting systemic risks.

Points of discussion

  1.  How can private credit and broader NBFI innovation deliver more resilient long-term financing?

  2.  How can public authorities and market participants strengthen the resilience of private credit and NBFI without undermining financial innovation and market-based finance, while ensuring effective international coordination?