Banks are now trying to offload the AI data center debt they just underwrote

Major banks including JPMorgan, Morgan Stanley, and MUFG are attempting to offload billions in AI data center loans they underwrote just months ago, as they bump against internal exposure limits. The banks have spent over six months trying to distribute $38 billion in construction debt for Oracle-leased data centers in Texas and Wisconsin, with some willing to sell at discounts to non-bank investors. Oracle's rising default insurance costs and credit downgrade to near-junk status reflect growing concerns about the sustainability of these massive AI infrastructure investments.