Bank of Canada reports C$500B exposure to private credit, mostly tied to US markets

Canada’s financial institutions have accumulated roughly C$500 billion, or about $360 billion, in private credit exposure. The Bank of Canada disclosed the figure in an August 2026 analysis titled “Private Credit in Canada,” and the geographic tilt is striking: most of that money is parked in US markets. The number aggregates holdings from life insurers, pension funds, investment funds, and banks, painting a picture of an industry that has been steadily loading up on a less transparent corner of the lending world while public attention focused elsewhere. Who’s holding what Life insurers are the biggest players. They hold over C$200 billion in private credit as of Q1 2026, representing about 22% of their total invested assets. Pension funds come in close behind at approximately C$215 billion as of the end of 2025, though that represents a smaller share of their overall portfolios at around 9% of total assets. Investment funds hold about C$54 billion, and banks carry at least C$40 billion. The common thread across all these institutions is a preference for direct lending over pooled investment vehicles. Rather than buying into private credit funds managed by third parties, Canadian i...