CoreWeave debt selloff poses limited risk to global banks, J.P. Morgan says

By Siddarth S Oct 20 (Reuters) Most global banks have limited exposure to CoreWeave, J.P. Morgan estimated on Tuesday, after the Nvidia-backed cloud company s stocks and bonds slumped last ​week on investor worries over debt financing. AI infrastructure spending ‌has been rattling investors globally as tech companies are on a fundraising spree from private-credit investors, banks and bond markets to rapidly expand, while questions over returns on these investments swell. While large US investment banks along with ‌Japan s ​MUFG could potentially have exposure of about $1 ⁠billion to $3 billion in CoreWeave, ⁠most European and Asian players have less than $500 million, the Wall Street brokerage said. Much of this is through delayed draw term loans, J.P. Morgan said, which are largely held through ​special-purpose vehicles, with capital released as projects meet milestones. From the perspective of financing banks, we view bank exposures to CoreWeave ⁠as well managed and very well ⁠sec