Proskauer is one of the premier legal advisers to asset managers, including private credit platforms, as they partner with banks, insurers, sovereign wealth funds, and other sources of capital to provide creative solutions for their clients and leverage each other’s strengths. We have been at the forefront of this evolving area for more than 15 years, advising clients as they consider joint ventures and other strategic partnerships. Proskauer has an interdisciplinary team of corporate, funds, regulatory, employment, and finance lawyers with deep expertise and practical experience in structuring these types of arrangements.

Joint ventures between banks and private credit firms have become increasingly common as both sides respond to structural changes in the lending market. Heightened regulatory capital requirements and supervisory scrutiny have constrained banks’ ability to hold certain types of loans on their balance sheets, particularly in leveraged and middle-market lending. At the same time, some private credit managers have amassed significant investing dry powder as a result of investor demand for floating-rate, yield-oriented assets. Joint ventures allow banks to provide solutions to their clients while sharing risk and capital burdens with private lenders that are less constrained by bank regulation.

From the private credit perspective, partnering with banks provides access to proprietary deal flow and long-standing borrower relationships that would be difficult, time-consuming, and costly to replicate independently. Banks contribute origination scale, sector expertise, and a diversified suite of credit solutions, while private lenders contribute flexible capital and a higher risk appetite. These structures can take many forms — co-lending arrangements, programmatic forward-flow agreements, and jointly managed vehicles — but they share the common goal of combining the strengths of regulated and non-regulated capital to compete more effectively in the market.

Broader market dynamics are also reinforcing this trend. Borrowers increasingly seek certainty of execution, larger hold sizes, and customized financing solutions, particularly in volatile interest rate environments and during periods of bank retrenchment. Joint ventures help meet these needs by creating hybrid platforms capable of offering both balance-sheet lending and off-balance-sheet capital at scale. As private credit continues to institutionalize and banks adapt their business models, these partnerships are likely to remain a durable feature of the evolving credit ecosystem.