Increased borrowing by the financial sector boosted cross-border bank credit by mid-2025, and a depreciating dollar underpinned growth in the provision of U.S. dollar credit, according to the latest data from the Bank for International Settlements (BIS).
The value of global bank credit rose by $917 billion (all figures in U.S. dollars) in the second quarter to $37 trillion. Most of the increase was driven by lending to financial firms, $773 billion worth, particularly banks ($540 billion).
On a year-over-year basis, the growth of credit to non-bank financial institutions (NBFIs) rose to 16% in the second quarter, up from 11% at the end of 2024 — and the growth rate of credit to banks was up to 9% from 6%, over the same period.
Cross-border credit to the financial sector was concentrated among borrowers in a few locations, the BIS said — with borrowers in the Cayman Islands, the U.S., the Netherlands and the U.K. accounting for about half of the growth in cross-border credit to this sector ($386 billion of the $773 billion).
For the Cayman Islands and the U.S., non-banks accounted for the lion’s share of the sector’s credit growth, while banks were the dominant counterparty in most other jurisdictions.
By geography, the BIS noted that cross-border bank credit to borrowers in the U.S. increased by $112 billion in the second quarter, “against a backdrop of tariff developments and a depreciating dollar” — with most of the increase driven by lending to U.S.-based non-banks.
The deprecation of the U.S. dollar in the first half of 2025 also drove the faster growth rate in the provision of U.S. dollar credit to non-banks outside the U.S., the data showed.