Citi and BlackRock/HPS Launch $17.5 Billion Private Credit Program

Citigroup and BlackRock's HPS Investment Partners have launched a $17.5 billion private credit program aimed at expanding direct lending across Europe, the Middle East, and Africa. The five-year initiative targets corporate and sponsor-backed borrowers with sub-investment grade debt instruments and customized private credit solutions.

Key Details

• Structure: Citi sources deals via its corporate relationships and sponsor coverage; HPS/BlackRock provides the balance sheet and underwriting capacity.
• Geography: Continental Europe, UK, with potential expansion into the Middle East.
• Focus: Sub-investment grade debt, customized private credit solutions.
• Deal Pipeline: Targets approximately €15 billion of financings over five years.

Strategic Significance

• Represents a shift from "banks vs. private credit" to hybrid origination partnerships.
• Follows Citi's earlier $25 billion US private credit partnership with Apollo.
• Reinforces BlackRock's post-HPS acquisition ambitions in private markets.
• Signals that private credit is entering an institutionalization phase where banks and private capital firms co-originate rather than compete.

Market Context

The program lands amid heightened scrutiny of private credit — regulators, allocators, and bank executives have raised concerns about loan quality, valuation transparency, liquidity mismatches, and risk migration from regulated banking to less transparent private vehicles. The Citi-HPS partnership suggests that despite this scrutiny, institutional-scale private credit expansion is not slowing — it is becoming more organized and intermediated.