While the Federal Reserve’s October 2024 survey indicates lenders remain cautious about short-term loan growth, banks remain well-capitalized and highly liquid by historical standards. With competition from private lenders intensifying, traditional banks will likely need to ease credit standards to maintain market share in the Commercial and Industrial (C&I) loan sector. Meanwhile, the private credit market is experiencing rapid expansion, backed by nearly $385 billion in available capital. Once considered a last-resort lending option, private credit has evolved into a viable alternative to traditional banks, offering speed, certainty to close, and flexible terms. As a result of abundant liquidity, businesses should be in the drivers seat in their next capital raise.

In this dynamic environment, borrowers are positioned to negotiate lower costs, secure greater access to debt, and obtain more favorable terms. With competition heating up between banks and private lenders, 2025 presents a prime opportunity for businesses to secure strategic financing. Engaging a Debt Capital Market (DCM) advisor can help borrowers navigate this evolving landscape, while creating the competitive tension necessary to ensure the best possible financing outcome.

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