BIS Review 40/2009  3  further in the near term; in addition, many banks have tightened terms and standards for nonmortgage consumer loans. Turning to the business sector, and in particular the corporate sector, the major components of borrowing are bonds, commercial paper, commercial mortgages, and commercial and industrial bank loans.
As shown in the left panel of figure 4, gross bond issuance for investment-grade firms increased in the fourth quarter of last year from a very weak third quarter and seems to have increased further in the first quarter of this year as firms appear to have strengthened their balance sheets by shifting toward longer-term debt. In contrast, speculative-grade bond issuance has remained sluggish.