International Banking: History and Evolution of Eurocurrency Markets
PART 7: INTERNATIONAL BANKING AND FINANCIAL INSTITUTIONS
CHAPTER 22: International Banking
FOCUS OF THE CHAPTER
The main focus of the chapter is on international banking. Following a brief discussion of international banking and international financial centres, an introduction to the current and capital accounts of the balance of payments is presented. The monetary and absorption approaches to the balance of payments and the concept of twin deficits are introduced. The history and evolution of Eurocurrency markets are discussed. The need for and the difficulties of regulating international banking are highlighted. The chapter ends with a discussion of the international debt crisis and country risk.
Learning Objectives:
1* Describe how international banking activities and their regulations have evolved
Describe the interaction between public and private sector borrowing and balance of payments developments
2* Discuss the history and evolution of the Eurocurrency market and analyze how its presence affects a typical bank's balance sheet
3* List the major developments in the area of risk, especially international debt crisis
4* Identify the essentials of how country risk is determined
SECTION SUMMARIES
International Banks and Financial Centres
The growth of international trade and capital flows, especially since World War II, has led to the growth of international banking. The international banks have international sections and operate offices in other countries, or have branches in other countries. The US, Japanese, and Swiss banks top the list of the largest international banks in the world. Much of international banking (international lending and borrowing, interbanking operations, and foreign currency transactions) is conducted in the cities that have become international financial centres. London, New York, and Tokyo are the prime international financial centres. London is the largest banking centre. International
CHAPTER 22: International Banking
FOCUS OF THE CHAPTER
The main focus of the chapter is on international banking. Following a brief discussion of international banking and international financial centres, an introduction to the current and capital accounts of the balance of payments is presented. The monetary and absorption approaches to the balance of payments and the concept of twin deficits are introduced. The history and evolution of Eurocurrency markets are discussed. The need for and the difficulties of regulating international banking are highlighted. The chapter ends with a discussion of the international debt crisis and country risk.
Learning Objectives:
1* Describe how international banking activities and their regulations have evolved
Describe the interaction between public and private sector borrowing and balance of payments developments
2* Discuss the history and evolution of the Eurocurrency market and analyze how its presence affects a typical bank's balance sheet
3* List the major developments in the area of risk, especially international debt crisis
4* Identify the essentials of how country risk is determined
SECTION SUMMARIES
International Banks and Financial Centres
The growth of international trade and capital flows, especially since World War II, has led to the growth of international banking. The international banks have international sections and operate offices in other countries, or have branches in other countries. The US, Japanese, and Swiss banks top the list of the largest international banks in the world. Much of international banking (international lending and borrowing, interbanking operations, and foreign currency transactions) is conducted in the cities that have become international financial centres. London, New York, and Tokyo are the prime international financial centres. London is the largest banking centre. International