Alongside regional leaders, US Secretary of State Antony Blinken will attend the meetings
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Lending between banks accounted for about half of the drop, while another half of 903 billion dollars constituted lending to non-banks, according to the Bank for International Settlements.
“After a relatively small change in total outstanding stocks in the third quarter, banks’ external claims shrank by 5.4 percent in the fourth quarter of 2008 to 31 trillion dollars,” the BIS said in its quarterly report on international banking statistics.
“This was the largest reduction ever recorded in a single quarter,” it added.
The biggest fall was recorded in loans, which plunged 1.678 trillion dollars, followed by securities, which fell by 211 billion dollars.
Claims denominated in US dollars declined by 6.0 percent while those in yen were down 15 percent.
Banks have become extremely reluctant to lend to each other since the beginning of the financial crisis in 2007.
The latest statistics revealed the severity of a global credit crunch that emerged following the dramatic collapse of US banking titan Lehman Brothers in September 2008.
As banks sought to protect their capital base, they stopped lending not only to fellow banks but also to industries.
As a result, major central bankers had to take coordinated action on several occasions to offer cash to the markets in a move to prevent the credit squeeze from choking off commercial bank lending.
The BIS statistics also indicate that during the fourth quarter of last year, banks were hit by 1.7 trillion dollars’ worth of withdrawals to leave them with total liabilities of 28.731 trillion.
Deposits plunged by 1.873 trillion dollars and securities by 232 billion dollars. However, this was partly offset by “other stocks,,” which gained 369 billion dollars.
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