⚠ Private Credit Wants the LoanLow threat

Goldman Sachs (GS) — threat to the moat

Goldman arranges leveraged loans and runs private credit funds that compete to make them.

Leveraged lending is contested by lenders that are not banks, and Goldman is on both sides. It ranked first in leveraged loans in 20251, and it also raised $34 billion of third-party money for credit funds that year2. Its credit funds charged an average fee of 69 basis points in the fourth quarter of 20253.

Third-party alternatives fundraising by strategy, 2025 ($bn)48Corporate equity34Credit25Hedge funds and other8Real estateGoldman Sachs Q4 2025 earnings presentation
$34bn raised for credit in one year.

The two can compete for the same borrower. A company that once took a syndicated leveraged loan arranged by a bank can now borrow directly from a private credit fund, and the bank earns no underwriting fee. Goldman's answer is to own the fund as well, so it keeps a management fee even when it loses the arrangement fee.

Goldman's credit funds charge more than its average alternative. Credit funds earned an average of 69 basis points in the fourth quarter of 2025 against 57 for all alternatives4. Every such loan that lands in one of Goldman's own funds keeps some fee inside the firm.

The firm lists acquisition finance, alongside equities and FICC financing and wealth lending, among the areas where its balance sheet can support clients5. A buyout financed by a private credit fund still needs advice and hedging, so losing the loan does not mean losing the client.

That hedge is only partial, because an arrangement fee is paid up front and a management fee is spread over years. Were Goldman to fall out of the top three in leveraged loans while its credit fundraising kept growing, the fund business would be replacing the lending business.

References
  1. ReportedIt ranked first in leveraged loans in 2025, and it also raised $34 billion of third-party money for credit funds that year.
    Goldman Sachs fourth-quarter 2025 earnings presentation and strategy update, Form 8-K exhibit 99.2 - Asset & Wealth Management: alternatives fundraising, fees, wealth, mandates and historical principal investments. — FY2025 · publ. 15 January 2026 · source ↗
  2. ReportedIt ranked first in leveraged loans in 2025, and it also raised $34 billion of third-party money for credit funds that year.
    Goldman Sachs fourth-quarter 2025 earnings presentation and strategy update, Form 8-K exhibit 99.2 - Asset & Wealth Management: alternatives fundraising, fees, wealth, mandates and historical principal investments. — FY2025 · publ. 15 January 2026 · source ↗
  3. ReportedIts credit funds charged an average fee of 69 basis points in the fourth quarter of 2025.
    Goldman Sachs fourth-quarter 2025 earnings presentation and strategy update, Form 8-K exhibit 99.2 - Asset & Wealth Management: alternatives fundraising, fees, wealth, mandates and historical principal investments. — FY2025 · publ. 15 January 2026 · source ↗
  4. ReportedCredit funds earned an average of 69 basis points in the fourth quarter of 2025 against 57 for all alternatives.
    Goldman Sachs fourth-quarter 2025 earnings presentation and strategy update, Form 8-K exhibit 99.2 - Asset & Wealth Management: alternatives fundraising, fees, wealth, mandates and historical principal investments. — FY2025 · publ. 15 January 2026 · source ↗
  5. ReportedThe firm lists acquisition finance, alongside equities and FICC financing and wealth lending, among the areas where its balance sheet can support clients.
    Goldman Sachs fourth-quarter 2025 earnings presentation and strategy update, Form 8-K exhibit 99.2 - Asset & Wealth Management: alternatives fundraising, fees, wealth, mandates and historical principal investments. — FY2025 · publ. 15 January 2026 · source ↗
Sources
Generated September 28, 2026