JPMorgan’s Jamie Dimon says a credit-led recession would be ‘worse than people think’

Dimon says Europe should adopt Draghi competitiveness proposals

By Nora Redmond

Published: April 29, 2026 at 8:07 a.m. ET

Photo: Fabrice Coffrini/Agence France-Presse/Getty Images

JPMorgan Chase CEO Jamie Dimon says an economic downturn sparked by weakness in credit would encompass more than just the private credit segment and be worse than many expect.

“We haven’t had a credit recession in so long, so when we have one, it would be worse than people think,” he said at an investment conference run by the world’s largest sovereign wealth fund, the Norges Bank Investment Management on Tuesday, in a presentation that was released as a podcast. “It won’t be terrible, it’ll just be worse than people think in private credit.”

The boss of the world’s biggest bank noted that out of the thousands of private-credit firms, some of them are “brilliant,” “but I guarantee to you not all thousand of them are,” he said.

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Concerns over a possible private-credit crisis is intensifying as Wall Street’s biggest banks have increasingly come under fire for their significant exposure.

Anxious investors worry that underwriting standards may have loosened at private-credit firms as it rapidly grew to become a $2 trillion industry. Attention has honed in on software companies, which have received more loans from private-market lenders than any other sector, because developments in artificial intelligence are seen to threaten the models of these businesses.

According to Moody’s, which provides credit ratings for companies and governments, U.S. banks’ exposure to private credit was almost $300 billion, as of June last year. ⁠Jeremy Barnum, chief financial officer at JPMorgan, told analysts in a call earlier this week that the bank had about $50 billion in private-credit loans. The New-York headquartered company holds that worries of a “systemic crisis” in the market are “overstated,” as of a note published in mid-April.

Dimon said that private credit, which has reached about $1.7 trillion, is not a “huge” or “systemic” risk when compared to the values of other loans, like high-yield bonds or mortgages.

“Even if a lot of it goes bad, it’s not going to cause a problem and some of it’s longer-term funded,” he added.

Dimon also warned of Europe’s slowing growth, stemming from “anti-business taxes” and anti-capital policies.

Europe’s economy needs scale and scope to support both businesses and civilians, he said.

“Affording social safety nets, affording national defense – you’ve got to be a little more competitive,” Dimon said.

He explained that if the European Union acts on the nearly 400 recommendations laid out in former European Central Bank President Mario Draghi’s report on competitiveness, he believes the U.S. should introduce a free trade policy with it.

“We should have free and open trade,” Dimon said. “I think if we did that, Europe would grow, be stronger, which would be good for America.”