Corporate debt could be the next sub-prime crisis, warns banking body

Group for central banks says borrowing by firms with low credit scores is growing alarmingly, especially in US and UK

Corporate borrowing poses a danger to the global financial system and could trigger a crisis in the same way US sub-prime mortgages sparked the 2008 banking crash, the organisation that represents the world's central banks has warned.

Citing the US and the UK as the worst offenders, the Bank for International Settlements (BIS) said in its annual health check of the global financial system that a dramatic rise in borrowing in recent years by businesses with low credit scores meant the market for corporate debt was becoming increasingly unstable.

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