The artificial intelligence (AI) boom is now reshaping credit markets. According to a new report from JPMorgan Chase & Co, debt tied to AI has surged to $1.2 trillion, making it the largest segment of the investment-grade bond market, surpassing American banks.

JPMorgan analysts found that AI-linked firms now account for 14% of the high-grade market, up from 11.5% in 2020. By comparison, banks in the United States (US) represent 11.7%. The analysis identified 75 companies across technology, utilities, and capital goods sectors closely tied to AI, including Oracle, Apple, and Duke Energy.

AI-related bonds trade at tighter spreads, reflecting investors’ confidence in these companies’ credit strength. Most are cash-rich and lightly leveraged, JPMorgan said, justifying their premium valuations.

Oracle’s recent $18 billion bond sale, the second-largest high-grade deal of the year, drew nearly $88 billion in orders. Banks and private credit firms are now racing to underwrite similar deals for data-centre expansions.