Cross-border bank credit rises, global liquidity indicators update
The Bank for International Settlements (BIS) released its global liquidity indicators for end-December 2025. The data shows a notable increase in cross-border bank credit and claims.
Cross-border claims show strong growth
The Bank for International Settlements' (BIS) latest global liquidity indicators reveal a substantial increase in cross-border bank claims and credit at the end of December 2025.
Quarterly changes in all claims reached 0.994 trillion US dollars in Q4-2025.
This contributes to an annual growth rate of 11.47 percent for all cross-border bank credit.
Loans and deposits, a key component, saw an annual growth of 11.33 percent, while debt securities grew by 11.83 percent.
These figures indicate a robust expansion in international banking activity, reflecting increased financial interconnectedness globally.
The growth is consistent across various instruments, suggesting broad-based demand for cross-border financing.
This trend follows a period of more moderate growth earlier in 2025, with a noticeable acceleration in the final quarter.
EMDEs drive credit expansion
The latest data highlights a significant contribution from Emerging Market and Developing Economies (EMDEs) to the overall expansion in cross-border bank credit.
In Q4-2025, quarterly changes in credit to EMDEs in major currencies (USD, EUR, JPY) increased by 29.86 billion US dollars, with other currencies also showing an increase of 12.23 billion US dollars.
This robust growth in EMDEs contrasts with more varied trends in advanced economies, where major currency credit rose by 516.24 billion US dollars in the same quarter.
Regionally, all EMDE sub-regions, including Emerging Asia excluding China, Latin America and Caribbean, and Africa and Middle East, registered positive annual growth rates in cross-border bank credit, underscoring their increasing integration into global financial flows.
Interconnectedness brings opportunities and risks
The sustained rise in cross-border bank credit underscores a deepening global financial interconnectedness, which can facilitate economic growth and capital allocation.
However, this trend simultaneously amplifies potential contagion risks, particularly for EMDEs reliant on foreign funding, demanding vigilant monitoring by financial authorities.
The indicators thus present a dual narrative of increasing integration alongside heightened systemic vulnerabilities.