Banks Struggled to Sell Oracle Data Center Debt

Syndicate banks have faced stalled interest while marketing $18 billion in loans for an Oracle-leased campus.

Updated on Sept. 18, 2026 in Data Centers

Isometric editorial illustration of an industrial cooling tower assembly for a data center, featuring rectilinear metal components and cooling vents. — Syndicate banks led by Santander and Jefferies have struggled to market $18 billion in debt linked to Oracle's massive AI data center infrastructure project. AI Illustration. Upload story photo >

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Syndicate banks led by Santander and Jefferies have struggled to offload $18 billion in debt associated with a New Mexico data center. Investors have remained wary as Oracle faces concerns over rising debt levels and a recent credit rating downgrade.

Why it matters

The stalled debt sale highlights growing investor caution regarding the massive capital expenditure required for AI infrastructure. As Oracle pursues the $500 billion Stargate initiative, its creditworthiness has become a central point of scrutiny for financial markets.

The debt supports a 1,400-acre data center campus in Doña Ana County, New Mexico. Oracle projects $95 billion in capital expenditure for fiscal 2027, with $25 billion expected in customer repayments.

The players

Oracle

This multinational computer technology corporation provides enterprise software and cloud computing services to businesses worldwide.

OpenAI

This artificial intelligence research organization is focused on the development and deployment of large language models.

Santander

This global financial services company is one of the largest banking institutions in the world.

Jefferies

This global investment banking firm provides capital markets advisory and financial services to corporate and institutional clients.

SoftBank Group

This Japanese holding company is a major investor in technology, energy, and telecommunications infrastructure.

The details

The data center is a key component of the $500 billion Stargate infrastructure initiative, a project involving Oracle, OpenAI, and SoftBank Group. Oracle entered this agreement to provide the immense AI computing capacity required for the partnership.

Late 2025: The $18 billion in loans was secured.
July 2026: S&P downgraded Oracle's corporate credit rating.
September 18, 2026: Loans were quoted at 89 to 91 cents on the dollar.
Fiscal 2027: Oracle projects $95 billion in capital expenditure.

The Tech Race

This debt struggle follows the ambitious capital trajectory established by the Stargate AI infrastructure project. It reflects the broader financial risks inherent in the massive expansion of hyperscale data centers needed to support modern generative AI.

Financial volatility involving major cloud providers could influence the availability and cost of AI-powered enterprise services. Users may see changes in pricing tiers as corporations adjust to maintain capital efficiency during infrastructure buildouts.

The takeaway

The difficulty in offloading this debt serves as a reminder that even the most ambitious tech projects are tethered to the reality of credit markets. Companies balancing extreme expansion must carefully manage their borrowing costs to maintain investor confidence.