24 October 2019

BIS international banking statistics at end-June 2019

Data shows that global cross-border bank claims expanded by 6% year over year, their highest annual growth rate since the Great Financial Crisis. Growth in lending to all major sectors increased.

The BIS locational banking statistics (LBS) show that global cross-border bank claims rose by $365 billion during the second quarter of 2019, to reach $31 trillion by end-June. Their annual growth rate, which averaged around 0% since the Great Financial Crisis, reached a post-crisis high of 6%.

Reporting banks' cross-border claims on all major sectors expanded during Q2 2019. The $190 billion expansion in claims on non-banks accounted for more than a half of the overall quarterly increase in global cross-border claims. This, in turn, was mostly driven by claims on non-bank financial institutions (NBFIs), which increased by $172 billion, resulting in an annual growth rate of 13%. The majority of this new lending to NBFIs was directed towards a few financial centres, such as the Cayman Islands ($37 billion), the United Kingdom ($34 billion) and Luxembourg ($24 billion).

The latest increase in lending to NBFIs is part of a longer trend. Over the past five years, cross-border claims on that sector have grown at an average annual pace of 7% (compared with 1% for claims on all sectors), reaching $7 trillion at mid-2019. The BIS consolidated banking statistics (CBS) reveal that the surge in lending to NBFIs over the past few years was mainly driven by Canadian, French, Japanese, UK and US banks.

Claims on borrowers located in advanced economies (AEs) expanded at a rapid pace. They grew at an annual rate of 7%, which took their outstanding stock to $21 trillion at end-June 2019. Their latest quarterly increase was primarily driven by claims on the United Kingdom (+$67 billion), France (+$65 billion), and Germany (+$61 billion). By contrast, claims on the United States declined by $30 billion.

Lending to offshore financial centres (OFCs) remained strong. It grew at 6% year over year  and stood at $5 trillion as of end-June 2019, mostly to the benefit of NBFIs.

Cross-border claims on emerging market and developing economies (EMDEs) rose by $43 billion during Q2 2019. The contraction in cross-border claims on developing Europe, which started in the middle of 2018, deepened in Q2 2019. The annual growth rate of lending to the region dropped to -8% at end-June 2019.

Full statistics on BIS

Related article on Financial Times: The global boom in non-bank finance

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