But you wouldn't really expect a random dude from the streets to get a five figure credit on his word alone, would you? Also, a five figure amount can be anything from 10k to 100k and in what currency exactly?
I don't know exactly how much, because I have no inclination to apply for a credit card and find out exactly. But everyone who opens a credit card gets given a credit limit. Some may get less than $1,000. Some may get as high as $100,000. For every single one of these credit cards, the person opening it does not have to provide a single piece of collateral. The credit given to them is based entirely on how likely or otherwise the bank they are to repay that credit - i.e. a promise. The bank does not increase its assets at any point; it simply creates new credit, and therefore new money, out of thin air.
Anyway, the loans you are talking about won't make a dent in the bank's balance if the borrower defaults on his debt, so my point still holds overall
That's not the point I'm making. Obviously the bank can absorb the loss of some loans; the point is that the money from these loans was created out of nothing without the bank increasing their assets or reserve at any time.