The growth of private credit likely has not materially adversely affected the financial system’s resilience,” Cook said at an event held by the Brookings Institution on Wednesday.

“Private credit funds appear well positioned to hold the riskiest parts of corporate lending” and are less vulnerable to funding runs, she added.

Cook, who chairs the Federal Reserve board’s committee on financial stability, said bank profitability remains solid and deposit volatility has settled down since a series of bank runs in 2023 when three lenders collapsed. She said losses on bond portfolios and commercial real estate concentrations remain an area of focus for bank supervisors.

“Supervisors are working closely with the set of banks that have experienced outsized fair-value losses from higher interest rates and with banks that have high concentrations of commercial real estate loans,” she said, adding that CRE risks are “sizable but manageable。