A $15 Billion Risky Debt Deal Heralds Day of Reckoning for Wall Street

On paper, the deal was a no-brainer: a $15 billion debt financing that would net banks hefty fees and kick off a year of mega-acquisitions even as central banks tightened the spigots on their pandemic support.

Yet eight months after agreeing to finance the leveraged buyout of workplace software company Citrix Systems Inc., Wall Street is now staring at a very different picture. Banks are nursing more than $600 million of losses on bonds and loans they just sold to investors at a steep discount. And they’re sitting on about $6.5 billion more Citrix debt that they’ll be stuck with indefinitely.