JPMorgan warning

JPMorgan is concerned about loans that finance some leveraged buyouts, and is scaling back from what is a booming area, even as its overall loan portfolio grows, a top executive said in an interview.

Reuters reports that loans that fund smaller leveraged buyouts, where companies often do not have the size or financial resources to weather a business downturn, look particularly hazardous, Doug Petno, chief executive of commercial banking at JPMorgan, told Reuters.

Seven years after the financial crisis, lenders are relatively sanguine about credit risk. Outstanding loans grew 1.63% in the first quarter for all U.S. banks from the fourth quarter, according to the Federal Reserve, a solid pace by historical measures.

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