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SaaS Credit Markets Pricing AI Disruption Risk: UBS Warns Default Rates Could Hit 13%
Credit markets are now systematically pricing AI disruption into SaaS company debt. UBS estimates default rates could reach 13% for US private credit if AI disruption accelerates — more than 3x the projected high-yield default rate. The BIS (Bank for International Settlements) published a quarterly review on the dynamic, with $600-750B in private credit loans underwritten against a thesis AI is now dismantling and $46.9B already trading at distressed levels. Software company stocks collapsed ~30% between October 2025 and February 2026. Lenders are demanding higher yields and tighter covenants, and some companies are pausing debt deals entirely.
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