The Bank of England has published its quarterly statistics on the external business of monetary financial institutions operating in the UK, providing a detailed picture of the cross-border lending and borrowing of the banks and building societies that make up the core of the British financial system.
The data for the first quarter of 2026 show that UK banks' cross-border lending increased by approximately £45 billion during the quarter, driven primarily by lending to borrowers in the European Union and the United States. Cross-border borrowing increased by a smaller amount, with the net result being an increase in the UK banking system's external asset position.
The statistics are an important input into the Bank's assessment of the health of the financial system and its exposure to risks originating outside the UK. The Bank monitors cross-border flows for signs of stress — sudden stops or reversals of lending, concentration of exposure to particular countries or sectors, maturity mismatches between assets and liabilities — that could indicate emerging vulnerabilities.
The data for the first quarter do not show any signs of significant stress. Cross-border flows have been broadly stable for several quarters, and the composition of lending and borrowing does not suggest any unusual concentrations of risk. The Bank said it would continue to monitor the data closely, particularly given the uncertainty created by geopolitical tensions and the disruption to global trade routes.
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