---
title: Nonbanks Will Earn Nearly a Fifth of Corporate and Investment Banking Revenue This Year, BCG Estimates
description: BCG estimates nonbanks will earn 19% of corporate and investment banking revenue in 2026, up from 4% in 2013, as banks lend to private credit funds.
author: Darie Nani (Editor-in-Chief)
date: 2026-10-15T13:30:33.549Z
updated: 2026-10-15T13:30:33.564Z
canonical: https://www.sovereignmagazine.com/article/nonbanks-investment-banking-revenue-private-credit
image: https://cdn.nanimediahouse.com/pexels-close-up-of-professionals-reviewing-documents-in-an-office-s-8171198.jpg
categories: Markets
content_type: News
region: Global
publication: Sovereign Magazine
schema_type: Article
---

Nonbank financial institutions such as private credit funds will account for an estimated 19% of global corporate and investment banking revenue in 2026, almost five times their roughly 4% share in 2013, according to Boston Consulting Group's 2026 Corporate and Investment Banking Report, published Oct. 14. BCG expects the nonbank share to reach about 23% by 2030.

BCG puts the global revenue pool, banks and nonbanks together, at a record $1.1 trillion this year, up more than 7% from 2025 and the sixth straight year of growth. The fastest-growing product in the business is bank lending to private credit funds: BCG says revenue from that financing compounded at roughly 15% a year from 2022 through 2025.

In the United States, [the bank share of corporate lending fell from 48% in 2015 to 29% in 2025](https://www.federalreserve.gov/newsevents/speech/bowman20260508a.htm), Federal Reserve Vice Chair for Supervision Michelle W. Bowman said in a May 8 speech at the Hoover Institution's monetary policy conference, and she named the private credit market as a significant driver of the decline.

## Bowman Says Bank Capital Rules Favor Lending to Private Credit Funds

"Current capital rules create a perverse incentive," Bowman said in the speech. Banks, she said, "receive a more favorable treatment for lending to private credit funds than for lending directly to creditworthy corporations."

Over the past decade, she said, bank lending to nondepository financial institutions, the Fed's category for nonbank financial firms such as private credit funds, has grown faster than any other kind of bank loan. Federal Reserve economists found in a May 2025 note that [banks' committed lending to private credit vehicles grew from around $8 billion in the first quarter of 2013 to around $95 billion in the fourth quarter of 2024](https://www.federalreserve.gov/econres/notes/feds-notes/bank-lending-to-private-credit-size-characteristics-and-financial-stability-implications-20250523.html).

Under the Fed's capital proposal, Bowman said, the risk weight on loans to investment-grade companies would generally fall from 100% to 65%, which would narrow the gap with loans to nonbank financial firms and let banks compete with them for creditworthy borrowers.

## Bowman Said in May That Banks Kept Lending to Private Credit Vehicles Despite Redemptions

She said some private credit funds had faced a wave of redemptions after private credit losses, concentrated among business development companies, or BDCs, that offer investors limited redemption rights. Banks' loan commitments to BDCs and other private credit vehicles, and the amounts outstanding, had still grown significantly over the past year, she said, and the loans generally appeared well collateralized.

The Fed economists who wrote the 2025 note found that bank loans to private credit vehicles had lower default probabilities and delinquency rates than bank loans to other nonbank financial firms. They described the financial-stability implications as limited so far, and said the growing ties between banks and private credit warrant close monitoring. Bowman said the Fed's Board will require the largest banks to report the total assets, net income and leverage of the nonbank financial firms they lend to.

## Revenue From Hedge Funds and Private Equity Firms Is Growing Faster Than From Corporate Clients

Over the past two years, BCG's report says, corporate and investment banking revenue from private equity sponsors grew about 5.5% a year and revenue from hedge funds about 9%, against roughly 1.7% from traditional corporate clients. Through 2030, BCG expects hedge fund revenue to grow about 9% a year and sponsor revenue about 8%, compared with 2% for traditional corporate clients.

Mergers and acquisitions have [rebounded this year, mostly in the largest deals](https://www.sovereignmagazine.com/article/2026-ma-recovery-narrow-megadeals-top). For private equity sponsors, BCG says, the financing, markets and treasury work around a deal carries more value than the advisory mandate itself, so a bank that wins the mandate and stops there captures only a fraction of what the relationship is worth.

Sponsors and hedge funds tend to buy advisory, financing, markets and transaction banking together, while most banks still price and staff each product separately, according to BCG, which says banks are beginning to reorganize around clients and platforms instead. "Sponsors and hedge funds are raising the bar," said Julian Hein, a BCG managing director and partner who coauthored the report. "They expect financing through the cycle, proprietary insight, and technology-enabled coverage, and they can tell a bank that has redesigned its workflows from one that has simply added new tools." Hein said banks with "one accountable relationship owner rather than a handful of product teams" are best placed to share in the growth.

## FAQ

**Q: Where does private credit get its money?**
Private credit funds raise most of their capital from institutional investors such as pension funds and insurers, Bowman said in her May speech. Some business development companies also take money from retail investors.

**Q: What are examples of nonbank lenders?**
Private credit funds and business development companies are the most direct examples. The Fed's wider category of nondepository financial institutions also includes insurers, private equity firms and broker-dealers.

**Q: How big is the private credit market?**
The US private credit market is about $1.4 trillion, Bowman said in May, similar in size to the leveraged loan market and the high-yield bond market but only about 10% of overall US corporate borrowing. The 2025 Fed note put private credit at $1.34 trillion in the United States and nearly $2 trillion globally as of the second quarter of 2024, roughly five times its 2009 size.