The growing financial risks from this AI boom
The AI boom's use of off-balance-sheet debt—exemplified by Meta's $27b Hyperion data centre—poses growing financial risks and echoes a hard lesson from the 2008 crisis.
Moving risks off balance sheets suggests the AI boom has forgotten a hard lesson from the 2008 global financial crisis.
Sa-Pyung Sean Shin
Meta’s US$27 billion (S$34.52 billion) Hyperion data centre illustrates a growing financial risk in the artificial intelligence boom: debt that sits outside a company’s balance sheet.
The facility is 20 per cent owned by Meta and 80 per cent by private credit giant Blue Owl and funded through bonds with maturities of about 24 years, sparing Meta most of the upfront cost.
Source: The Straits Times https://www.straitstimes.com/opinion/the-growing-financial-risks-from-this-ai-boom?ref=latest-headlines
