European private credit sector poised for expansion, according to Moody's analysis

The de-globalization trend is presenting substantial chances for the private credit market in Europe to capitalize

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2025 September 13 . 10:02 AM

2 min read

European private credit sector poised for expansion, according to Moody's assessment

European private credit sector poised for expansion, according to Moody's analysis

Europe's private credit market is at a turning point, according to a recent report by Moody's. The report suggests that the market could benefit from greater autonomy from the US and is poised for accelerated growth in the coming years.

One of the key drivers of this growth is the increasing use of private credit to bridge funding gaps in Europe. The depth of European capital markets has traditionally trailed that of the US, but with increased spending and private credit usage, this gap may narrow.

Moody's predicts faster growth for the European private credit market compared to other markets. This growth is partly due to investments from US investors, with wealthy investors having piled $48bn into private credit funds.

Blackstone, a leading firm in the industry, has committed billions to European expansion. In July, Blackstone's European Private Credit Fund raised €2bn (£1.73bn). The firm sees a $200bn investment opportunity in European private credit.

The momentum in the European private credit markets is expected to accelerate growth rates. Blackstone's commitment to Europe and the growing political urgency to ramp up spending on critical infrastructure in Europe are contributing factors.

De-globalisation is another factor accelerating calls for capital, particularly in Europe and the US. The smaller base of Europe, with its lower growth, is primed to grow faster than other markets.

The report highlights the potential of private credit in Europe amidst geopolitical challenges that are forcing greater autonomy. The untapped market potential in Europe also plays a significant role in the expected growth.

While specific US firms planning to invest large sums in expanding private credit markets in Europe over the next years are not clearly listed, Oracle, a US tech company, is mentioned as being involved in investments generally.

Despite a slowdown in growth in 2024, the overall outlook for the European private credit markets is positive. The growth rates are expected to outstrip the relative pace of the US in the next few years, making Europe an attractive destination for private credit investments.