JPMorgan Chase plans to divest $40 billion in private equity-related loan risks.

Insiders revealed that JPMorgan Chase is seeking to offload more than $4 billion in private equity fund loan-related risks. The bank is in discussions for a risk transfer plan that would allow it to retain the net asset value loans supported by private equity fund assets on its balance sheet, while transferring some potential losses to investors. Under the agreement, JPMorgan Chase will transfer up to 12.5% of the net asset value loan pool risk, which is valued at over $4 billion. This structure will provide investors with returns in the low teens percentage range to offset the first losses on the net asset loans. The asset pool includes several loans related to private equity funds in North America, Europe, and the Middle East. JPMorgan Chase declined to comment on this report.