With negative interest rates in parts of Europe it is not surprising that investors there are seeking better returns overseas - and Australia is one of their preferred destinations. As a recent chart from the Reserve Bank of Australia shows (see below), Europe has been the largest source of foreign bank lending to Australia's large corporate borrowers. And a report from East & Partners this week reveals that, over the past three years, locally-based foreign banks have increased their market share of total deposits by over nine per cent, outperforming the Big Four locals. The East data shows that in the institutional segment (the Top 500 with over A$725 million annual turnover), the Big Four represent 80 per cent of primary financial relationships, with international banks lifting towards 15 per cent. Unprecedented monetary easing from the European Central Bank has helped restrain euro borrowing costs, while low government debt yields encourage buyers to take on credit risk elsewhere - and Australian banks and corporates are an attractive offering. It is also one of the main reasons for the recent growth of foreign banks, especially those with roots in Europe. Data from Bloomberg shows US, UK and Australian corporate bond rates are much more expensive than those in Japan, Switzerland and the EU. Europe is shown as 17.5 basis points lower than Australia. BNP Paribas said Australian borrowers had been attracted to Europe's bond market this year, lured by cheaper swap costs for euros and tighter credit spreads (compared to, say, the US). Australian firms have been led by BHP Billiton and the banks, selling €14.4 billion (A$16 billion) in bonds in the year to date, a 27 per cent increase over the comparable period last year. Bond issuance into Europe is on track for a record year according to Bloomberg data.  National Australia Bank is the biggest borrower so far in 2015, raising 3.25 billion euros, followed by Westpac and the Commonwealth Bank. BHP placed €2.0 billion euros with European investors. The five-year Australian dollar-euro basis swap, which measures the cost of moving funds between the two currencies, dropped to as little as 52 basis points in August, a level unseen since January, having risen to as much as 67 basis points in March. In contrast, issuance in the US by Australian firms is down 16 per cent so far this year. And, despite it being cheaper offshore, there has been a flurry of domestic raisings, for the likes of Sydney and Melbourne airports. While Australia's own bond market is also attractive for many issuers, it can't always provide the kinds of volumes and tenors more readily available in the US or Europe, noted BNP Paribas. In addition, there have not been many downgrades from Australian companies. "You