im21 - Chapter 21 Global Banking Activities Chapter...

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Chapter 21 Global Banking Activities Chapter Objectives 1. Describe the different types of organizational units that engage in global banking activities. 2. Demonstrate the impact that foreign banking organizations have in U.S. markets. Explain the universal banking model, which is common outside the U.S. 3. Identify the foreign banking activity of the largest U.S. banks. 4. Analyze the basic features of the Eurocurrency, Eurobond, and Eurocredit markets. Explain the status of the European Community and its potential impact on world markets. 5. Describe the organizational structure of U.S. banks’ that engage in global banking activities. 6. Describe the mechanics of bankers acceptance financing and extending loans globally. 7. Examine the role of bank foreign exchange activities, and explain the relationship between foreign exchange rates and interest rates. Key Concepts 1. U.S. banks have generally reported significant earnings from banking activities conducted outside the U.S. Foreign banks have similarly reported strong earnings on U.S. banking activities. 2. U.S. commercial banks conduct global business primarily through their home offices, foreign branches, foreign non-bank subsidiaries, Edge Act Corporations, and international banking facilities. Foreign banks conduct business in the U.S. via agencies and branches, bank subsidiaries, Edge Act banks, New York State Investment companies, and thrifts. Banks headquartered in Japan, Canada, France, the Netherlands, Switzerland, United Kingdom, and Germany have a major presence in various U.S. banking markets. 3. Many of the largest U.S. banks have extensive exposure in loans to foreign governments, private businesses, and individuals located outside the U.S. Citicorp, now part of Citigroup, has perhaps the greatest exposure and is involved in the widest range of activities as any U.S. based commercial bank. At year-end 2000, the U.S. had just 3 of the top 25 banks raned in terms of total assets. The U.S. had 6 of the top 30 banks. 4. Global financial markets enable participants to borrow and invest in different currencies quite easily. The
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This note was uploaded on 04/14/2010 for the course BANK 2312 taught by Professor William during the Spring '09 term at 東京大学.

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im21 - Chapter 21 Global Banking Activities Chapter...

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