FSB warns private credit boom is overexposed to AI datacentre bets

The FSB’s warning confirms that the AI boom is no longer just an equity story—it’s deeply intertwined with opaque private credit markets. Datacentres, power infrastructure and AI‑heavy tech firms have become major borrowers outside traditional banks. If valuations reset or a constraint like electricity bites, the resulting losses would hit not just specialist funds but also the banks that lend to or co‑invest with them.

This is important for the AGI race because it highlights a potential macro‑prudential brake on unconstrained AI build‑out. If regulators decide that private credit exposure to AI infrastructure is systemically risky, they could tighten capital requirements, scrutinise specific deal structures, or push activity back onto regulated bank balance sheets. That would make it harder to finance the next wave of hyperscale datacentres purely with lightly regulated capital.

At the same time, the report underscores how dependent frontier AI has become on a small set of capital‑intensive bets: power‑hungry facilities, specialised chips and a handful of fast‑growing labs and platforms. Systemic risk management for AI is no longer just about model behaviour; it is also about the leverage and concentration in the financial plumbing that funds the stack.