[DigitalToday reporter Chi-gyu Hwang] UBS analyst Matthew Mishe (매슈 미시) warned that corporate loans worth billions of dollars could be at risk of default under the threat of AI disruption, CNBC reported on Feb. 13 local time.

The report said Mishe made the projection while analyzing the impact of AI adoption on the corporate credit market.

Mishe said in particular that private equity-owned software and data services companies face AI threats, and that this could lead to $75 billion to $120 billion in new defaults. The estimate is based on forecasts that default rates in the leveraged loan market and the private credit market would each increase to 2.5 percent to 4 percent.

As AI adoption accelerates, broad-based financing stress and loan restructurings in credit markets appear inevitable. UBS noted that AI is rapidly changing how companies operate and their revenue structures, and that credit markets are unlikely to have time to adapt.

In the credit market, AI fallout is divided into three categories: startups developing foundation AI models; AI-responsive companies such as Salesforce and Adobe; and highly indebted private equity-owned companies. UBS expected the third group to suffer the biggest blow from the AI transition.