The default rate of US loans has exceeded a "psychological milestone" by overtaking its previous peak in the last credit downturn seven years ago, demonstrating the problems suffered by managers that hold complex loan portfolios.

US loan default rates - when measured on loan volumes - over the past 12 months is now at 8%, according to US bank Citigroup at the end of last week. This is now above the highs of the last credit downturn.