At a dinner party hosted by Morgan Stanley's senior bankers last month, a hot topic was the wealth earned through artificial intelligence (AI) frenzy.

There were many private equity titans at the table. Apollo Global Management Inc., Ares Management Corp., Blackstone, HPS Investment Partners, KKR Corp, and Oaktree Capital were all invited to attend; these companies, which have long dominated the lucrative corporate finance sector on Wall Street, have recently become fierce rivals.

However, according to people who attended the event, Morgan Stanley advocated cooperation that evening. The company believes that the investment required for the infrastructure of this latest digital revolution is so substantial that there is no need to argue about who should provide the loans. Instead, bankers and private financiers should be prepared to integrate their strength and resources.

So far, most of the speculation surrounding AI has been reflected in the stock market, as seen in the stock price of chip maker Nvidia; this frenzy has also spread to debt financing and private equity.

It is estimated that at least $1 trillion will be needed for datacenters, electrical utilities, and communication networks, which will propel AI to fulfill its promise of transformation across various fields including medicine and customer service. Others believe that the total cost could be double that amount.

Even some skeptics on Wall Street about the money-making potential of AI have said that it is worth continuing to invest in infrastructure providers; Goldman Sachs' stock research director, Jim Covello, is one of them.

Some banks are rushing to follow suit. According to an insider, JPMorgan has established a dedicated infrastructure team; Deutsche Bank and other banks have done the same. A banker from a rival company admitted that his bank has quite a lot of datacenter deals to handle, so there is not enough manpower to cope with the workload.

Debt financing is also the same. Morgan Stanley stated at the dinner party that the balance sheet of the banking industry is not large enough to meet the demand for credit, hence it proposes an alliance with the private equity circle: this feast, everyone is invited.

For investment bankers looking for the next feast, this opportunity comes at just the right time. Providing debt financing for businesses has long been a significant profit engine on Wall Street, but this business has recently gone through a sluggish period. Despite the strong performance of the stock market in the past few years driven by AI frenzy, the returns on investment-grade crediting have been weak. With M&A activities drying up, leveraged finance teams have been suffering.

Dominik Thumfart, head of Deutsche Bank, said that in the coming years, this market will remain a major growth area for financing. This German bank has already provided $17 billion in financing for data centers in three years.

Not only do large data centers play the role of manna from the sky in terms of financing. The technology industry's thirst for computing power has brought life to two of the most neglected corners in the corporate finance sector: utilities and telecommunications have suddenly become one of the hottest crediting markets.

For private market giants like Apollo and KKR, digital infrastructure also presents an opportunity to get out of the downturn. Companies like Blackstone, Brookfield Infrastructure Partners, and Stonepeak Partners have already ventured into data centers.

Larry Fink, the boss of BlackRock, stated that in collaboration with Microsoft, his company will raise as much as $120 billion in debt related to data centers. Bankers and private lending institutions will be eager to get a piece of the pie from such transactions.