Mutual funds that invest in leveraged loans may be pulling in less new money, but banks themselves have been picking up the slack in lending, putting them in competition with institutional investors and contributing to the general froth in the market.

U.S. leveraged lending slipped in the second quarter, to $151 billion, from $153 billion in the first quarter, according to Thomson Reuters; however, the share of loans funded by banks themselves increased by seven percentage points, to 43%.

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