Key Takeaways
- • Federal and state regulators are increasing scrutiny of private-credit valuations, raising concern about banks' growing exposure to hard-to-value, illiquid private assets, according to American Banker.
- • Private-credit assets are illiquid, individually negotiated loans that do not trade on any secondary market and therefore cannot be readily priced, which has historically limited them to accredited investors.
- • Truist Financial plans to close the Truist Leadership Institute in Greensboro, North Carolina, a training center that drew criticism for its executive-development techniques.
- • The Truist closure follows the arrival of CEO Mike Lyons last month, who told analysts the regional bank is conducting a detailed strategic review of each of its businesses, operations and processes.
Summary
Federal and state regulators are subjecting private-credit valuations to increased scrutiny, a development that American Banker reports has raised alarm about banks' expanding exposure to hard-to-value, illiquid private assets. Private-credit assets are typically individually negotiated loans that do not trade on any secondary market. Because they cannot be priced through market transactions, they have historically been offered only to accredited investors. The scrutiny comes as banks' involvement with these assets continues to grow, making valuation practices a focus for supervisors.
Separately, Truist Financial plans to close the Truist Leadership Institute, a leadership center in Greensboro, North Carolina, where employees receive training. According to American Banker, the decision further distances the company from its pre-merger past and redirects resources elsewhere. The institute had drawn criticism for using techniques that involved tapping into childhood trauma to improve would-be executives' leadership skills.
The closure comes shortly after Mike Lyons joined Truist as chief executive last month. Lyons told analysts last week that the regional bank is in the midst of a detailed strategic review of each of its businesses, operations and processes. The review is part of a broader effort by the new CEO to reassess the bank's priorities and cost base following the arrival of new leadership.
Separately, Truist Financial plans to close the Truist Leadership Institute, a leadership center in Greensboro, North Carolina, where employees receive training. According to American Banker, the decision further distances the company from its pre-merger past and redirects resources elsewhere. The institute had drawn criticism for using techniques that involved tapping into childhood trauma to improve would-be executives' leadership skills.
The closure comes shortly after Mike Lyons joined Truist as chief executive last month. Lyons told analysts last week that the regional bank is in the midst of a detailed strategic review of each of its businesses, operations and processes. The review is part of a broader effort by the new CEO to reassess the bank's priorities and cost base following the arrival of new leadership.
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