Kobeissi Letter Says Business Loans at Large US Banks Rose 11.4% in October to $1.6 Trillion, Driven by Borrowing for AI Infrastructure
AI infrastructure spending is driving a sharp increase in US bank lending: Commercial and Industrial (C&I) loans at large US banks surged +11.4% YoY in October, to $1.6 trillion, the most since June 2020. This also marked their largest YoY growth since February 2023. In Q3, C&I loans at the 25 largest US banks grew almost +10.0% YoY, the strongest growth in 10 years excluding pandemic-related swings. This represents a sharp reversal from an -8.0% YoY contraction in Q4 2025. The surge has been driven by rising borrowing demand from Big Tech companies and data-center developers to fund AI infrastructure projects. At the same time, regional lenders are providing credit to construction companies and other businesses benefiting from the investment boom. The data-center buildout is increasingly being funded by debt.
Context
If the AI buildout is increasingly paid for with bank debt, a slowdown in AI demand would reach lenders and the wider economy, not only tech stocks.
Commercial and industrial loans are bank loans to businesses, a common gauge of corporate borrowing. Big Tech companies and data center developers have been raising money through bonds, stock sales and loans to pay for AI infrastructure. Earlier in this deck, Oracle filed to raise $20 billion and Big Tech was reported to carry $3.3 trillion in future spending commitments.
Deep dive
The Kobeissi Letter (@KobeissiLetter) posted on the night of Nov 2 ET that AI infrastructure spending is driving a sharp increase in US bank lending.
According to the post, commercial and industrial loans at large US banks rose 11.4% from a year earlier in October, to $1.6 trillion, the most since June 2020. The post says this was also their largest yearly growth since February 2023. In the third quarter, it says, these loans at the 25 largest US banks grew almost 10% from a year earlier, the strongest growth in 10 years when pandemic swings are left out. That is a sharp reversal from an 8% yearly contraction in the fourth quarter of 2025.
The post attributes the surge to rising borrowing by Big Tech companies and data center developers to fund AI infrastructure projects, and says regional lenders are also extending credit to construction companies and other businesses that benefit from the investment boom. Its conclusion is that the data center buildout is increasingly being funded by debt.
The figures are relayed by The Kobeissi Letter, a markets commentary account, and the post does not name the underlying data source in its text. The link between the loan growth and AI is the account's own reading; the post does not break out how much of the new lending went to AI projects.
The post came less than an hour after the same account reported a record $3.3 trillion in Big Tech future spending commitments, a story also in this deck.
What to expect next
Watch the next weekly and monthly bank lending data to see whether the growth holds, and whether banks start breaking out how much of it goes to data centers. Bank earnings calls may also give more detail on AI related lending. If borrowing keeps rising while AI revenue lags, regulators and ratings agencies may start asking how exposed lenders are to the buildout.