The $1 trillion of high yield debt that's piled up in the last 5 years is about to have a 'day of reckoning,' Bank of America says

• There's around $1 trillion of private debt that's headed for potential trouble, Bank of America warned.
• Most of that debt has been created by below-investment grade companies through high yield loans or bonds.
• Around $400 billion assets are considered to be in "pre-distress," while $150 billion assets are "deeply distressed."

There's a mountain of high-yield debt that could be at risk, according to Bank of America. 

The bank estimated around $1 trillion of high yield debt has been accumulated by companies over the past five years, which has largely been created by below-investment grade corporations. Around 25% consists of below-investment grade firms issuing risky high-yield bonds, while 35% consisted of broadly syndicated loans taken out by below-investment grade companies, the bank said. The remaining 40% was classified as private debt.