Short Description:
The 2025 Shared National Credit report reveals moderate credit risk, with leveraged loans dominating stressed portfolios. Read key insights for finance professionals.
Read Time: 3 minutes, 15 seconds
Main Article
Federal banking regulators—the Federal Reserve Board, FDIC, and OCC—have jointly released the 2025 Shared National Credit (SNC) Program report, offering a crucial snapshot of risk in large syndicated loans. The data indicates that overall credit risk remains moderate, as borrowers continue to navigate higher interest expenses and persistent macroeconomic pressures. The review, covering loans originated by June 30, 2025, assessed commitments of $100 million or more shared across regulated institutions. This annual report is a vital tool for understanding systemic exposure in the banking sector.
The SNC portfolio expanded significantly, encompassing 6,857 borrowers and $6.9 trillion in commitments—a 6% annual increase. A notable finding is the decline in non-pass loans (rated “special mention” or “classified”) to 8.6% of commitments from 9.1% in 2024. However, regulators caution that this improvement stems primarily from portfolio growth via new lending, not fundamental credit enhancement. U.S. banks hold 45% of all SNC commitments but only 22% of non-pass loans, highlighting their relatively stronger risk positioning compared to non-bank holders.
A critical area of focus remains leveraged loans, which constitute nearly half of all SNC commitments and a staggering 81% of non-pass loans. This concentration underscores the heightened risk within the leveraged lending space. While the percentage of problematic assets has dipped, the sheer volume and proportion of stressed loans in leveraged segments warrant close monitoring by risk managers and investors. The report reinforces that credit risk trends are tightly linked to borrowers’ capacity to service debt amid fluctuating economic conditions.
Short Summary
The 2025 Shared National Credit report shows moderate systemic risk with a larger portfolio. The decline in non-pass loans is driven by new lending, not better credit quality. Leveraged loans remain the primary risk concentration, accounting for most stressed assets. U.S. banks hold a smaller share of these riskier exposures. Overall, the data signals cautious stability amid ongoing economic headwinds.
