Citi and BlackRock strike €15bn European private credit partnership

Citi has struck a €15bn private credit partnership with BlackRock’s HPS Investment Partners, adding another sign that banks and asset managers are reshaping corporate lending in Europe.

The partnership will provide loans to European companies and leveraged buyout borrowers over the next five years, with a focus on more complex credit that can include junior and mezzanine debt.

The deal matters because banks are increasingly working with private credit managers rather than competing with them outright. Regulation and capital costs have made some types of corporate lending less attractive for banks to hold directly, while private credit funds need origination channels to deploy capital.

For borrowers, the model could broaden access to financing, particularly where lending needs are too complex or leveraged for standard bank balance sheets.

For the wider corporate finance market, the partnership shows how private credit is moving deeper into mainstream lending. It also follows Citi’s earlier US private lending partnership with Apollo, suggesting the bank sees these structures as a strategic way to regain lending share without taking all the balance sheet exposure.

The arrangement is not trade finance in the narrow sense, but it is relevant to alternative finance and working capital markets because it reflects a larger shift in how corporate credit is originated, distributed and funded.

As European companies face higher borrowing costs and slower growth, bank-private credit partnerships are likely to become a more important source of liquidity.