A Goldman Sachs bet put in place in 2021 on lending to private funds has helped drive record revenues in fixed-income financing. Now, the Wall Street bank is pushing even deeper into the growing but risky market.

The fund finance unit, housed in the bank’s global banking and markets division, lends money secured by different types of assets to private equity and other funds. Such assets, however, can be hard to value and trade, and some loan products are yet to be tested in a downturn, making lending against them risky.

Goldman has revealed few details about the business, but interviews with bank executives and industry experts provide a window into the unit and its operations.