European banks have extended around €120bn (£104bn) in loans to private credit funds, equivalent to only around 0.7 per cent of their combined assets, according to a new survey by Moody’s Ratings.

European banks have lending commitments of around €200bn, compared with loans of around $350bn and total commitments of $500bn for US banks, the survey found. The survey found that exposure in Europe is still concentrated among the region’s largest banks, with five large banks dominating European lenders’ private credit exposure, accounting for 76 per cent in total.

Read more: Investors signal appetite for private credit in emerging markets

The survey also found that two thirds of European banks’ private credit exposure is in the US, split between senior secured portfolio financing and subscription facilities.

Business development companies – which have seen a surge in redemption requests over the past few months – account for less than five per cent of large European banks’ private credit portfolios. However, banks also have around 20 to 25 per cent indirect exposure to the software-as-a-service industry, which is at risk of disruption by artificial intelligence.

Private credit funds remain a small part of the non-bank financial institution sector, to which European banks lent a combined €1.6tn in 2025, or about 11 per cent of their total loans, up from an 8 per cent share in 2015, Moody’s said.