Credit risk associated with large, syndicated bank loans remains moderate, with credit risk trends reflecting the effects of borrowers’ ability to manage higher interest expenses and other macroeconomic factors, three banking agencies said today in their most recent Shared National Credit Program report.
The SNC Program assesses risk in the largest and most complex credit facilities shared by regulated financial institutions and nonbank investors. The review by the FDIC, Federal Reserve and Office of the Comptroller of the Currency reflects the examination of SNC loans originated on or before June 30, 2025.
The 2025 SNC portfolio included 6,857 borrowers, totaling $6.9 trillion in commitments, an increase of 6% from a year ago, according to the agencies. The percentage of loans that deserve management’s close attention decreased to 8.6% of total commitments from 9.1% in 2024. The decline is primarily due to growth in new commitments rather than an underlying improvement in credit quality.
U.S. banks hold 45% of all SNC commitments. However, they only hold 22% of non-pass loans, down slightly from the prior year. Nearly half of total SNC commitments are leveraged, and leveraged loans comprise 81% of non-pass loans.
