The percentage of large syndicated US loans rated as problematic has nearly tripled in the last year, highlighting the damage done by the lax underwriting standards of the private equity boom, a report by US regulators showed on Wednesday.

During 2006 and early 2007, leading banks competed fiercely to lend to private equity groups, often dispensing with the usual covenants meant to secure such credits in a development that led to the so-called “cov-light loan”.