Statistical release: BIS international banking statistics and global liquidity indicators released

The Bank for International Settlements issued its BIS locational banking statistics (LBS)  on global liquidity indicators.  The key findings of this report are as follows:

  • Banks' cross-border claims fell by $1.4 trillion in Q4 2022, slowing the year-on-year (yoy) growth rate to 6%. Both lower bank credit (ie loans and holdings of debt securities) and a drop in the market value of banks' derivatives and other residual instruments contributed to the decline.
  • Global cross-border bank credit (ie loans and holdings of debt securities) fell by $749 billion, or $400 billion on a seasonally adjusted basis. Euro-denominated credit declined by $231 billion after expanding earlier in the year.
  • Cross-border bank credit to emerging market and developing economies (EMDEs) fell by $179 billion in Q4 2022 due to weaker dollar lending. Credit to the Asia-Pacific region contracted the most.
  • The BIS global liquidity indicators (GLIs) show a large contraction in dollar credit to non-banks in EMDEs in Q4 2022. Dollar credit to EMDEs shrank by 4%, a rate last seen during the Great Financial Crisis of 2007–09.

Given the recent failures around the world of banks, largely as a result of aggressive action to contain inflation, watching this data may give insight into future policy on liquidity and capital in the future.

Bank of International Settlements