KBRA has released new research revealing that private credit’s exposure to First Brands Group LLC is minimal, even as the company faces a complex debt profile exceeding $9 billion. The findings provide important context for investors following the recent bankruptcy petition of the automotive parts manufacturer.
According to KBRA’s analysis, none of First Brands’ nearly $6 billion in broadly syndicated loans (BSL) were originated by private credit or direct lending platforms. This distinction highlights the limited involvement of private lenders in the company’s financing structure, suggesting that broader private credit markets remain insulated from any potential fallout.
Financial Technology Insights: Parafin & Fullsteam Surpass $125 Million in Small Biz Funding
The report also details that, beyond its term loans, First Brands’ bankruptcy filings disclosed an additional $2.3 billion in off-balance-sheet obligations, nearly $600 million in asset-based loans from traditional banks, and over $800 million in supply chain financing owed to roughly 30 unsecured creditors. These creditors include a mix of trade and commercial finance firms, hedge funds, and banks, illustrating the extensive but largely institutional nature of the company’s obligations.
Financial Technology Insights: Rodney E. Hood Rejoins SRM’s International Advisory Board
Overall, KBRA concludes that private credit firms have only marginal exposure within the company’s vast debt structure an encouraging signal for investors concerned about potential contagion effects within the direct lending market.
Financial Technology Insights: Advisor Team with $260 Million Assets Joins Ameriprise
As one of the major global credit rating agencies, KBRA continues to monitor credit risk developments across sectors. The agency, registered in the U.S., EU, and UK, also holds designations in Taiwan and Canada, allowing its credit ratings to be used for regulatory capital purposes across multiple jurisdictions.
By publishing this analysis, KBRA reinforces its commitment to providing transparent, data-driven insights that help investors understand credit exposure, mitigate risks, and make informed decisions in a rapidly changing financial landscape.
To share your insights with the FinTech Newsroom, please write to us at sudipto@intentamplify.com