In their 84th Annual Report, the Bank for International Settlements examines the current state of global financial affairs and highlights some trends it sees emerging in the financial framework. While noting that the overall financial system has has gained some strength since the crisis, banks remain in a rebuilding phase, concentrating their business models towards traditional banking. Despite their apparent recovery, BIS warns that banks face lingering balance sheet weaknesses from direct exposure to overindebted borrowers, the drag of debt overhang on economic recovery and the risk of a slowdown in those countries that are at late stages of financial booms. They also note that in the current financial landscape, market-based financial intermediation has expanded, notably because banks face a higher cost of funding than some of their corporate clients. Asset managers appear to have stepped into the gap left by banks in the intermediation markets. Their rapid growth in this area together with high size concentration in the sector, BIS warns, may influence market dynamics and hence the cost and availability of funding for firms and households.