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CHAPTER 1: INTRODUCTION TO INTERNATIONAL BANKING (PAST SEM QUESTION :!?:,…

- - - - :pen: Starting in 1960’s and lasting three decades.
      - :pen: Mainly related to international banking transactions among develop countries.
      - :pen: As a key economic power and growth of their foreign direct investment (FDIs).
      - :pen: Occurred when US bank began to expand out of the country to meet the financial requirements .
      - :pen: To take an advantages of cheaper financing outside local market and to gain competitive advantage.
      - :pen: US bank was subject to limit on their interest payment on deposits and maintain the reserve required.
    - - 💥Started in 1830s and spurred by the underwritting securities activities
      - 💥Performed in the second half of the 19th century by J.P. Morgan, Lehman Brothers, and Goldman Sachs
      - 💥These big companies sold the underwritten securities in London to European investors or players
      - 💥The expansion of banks in overseas during the first half of the 20th century was slightly limited
      - 💥Its happened due to the decline of the British and its colonial empire
      - 💥Economic uncertainty and changing in political view has restricted the rivalries coming from the foreign countries
    - - :pencil2: End of 1990’s, international banking was denominated by large banking from the US, Japan, Germany, the UK, France, Italy and Canada
      - :pencil2: International banking was formed through the consolidation within national frontiers, cross border M&A and the ongoing shift to universal banking
      - :pencil2: Universal banking refers to the ability to offer the full range of financial services which acts as a one-stop centre
      - :pencil2: For instance, deposit-taking, loan-making, leasing, hire-purchase and etc
      - :pencil2: Biggest challenges of universal banking are to invest in R&D, to implement new system, and to be entrepreneurs friendly particularly by the Islamic banking sector
  - - - :check: They believed that the profits could be made in two conditions which are forced trade and natural resources.
        :check: The ruling nation was assumed to be intrinsically superior.
        :check: The conventional tenet of white colonizers held that there was an obligation to “rule subordinate, inferior and less advanced peoples”.
        :check: The Europeans viewed whatever their belongings i.e. cultures, government, administrative and educational policies as superior. And believed all were worthwhile to be transplanted.
- - - - 🎈Phenomenon in which financial markets in neighboring, regional or global economies are closely linked together
      - 🎈Information sharing among financial institutions, firms borrow and raise funds directly in the international capital markets
      - 🎈Investors directly invest in the international capital markets that newly engineered financial products are domestically innovated and originated then sold and bought in the international capital markets
      - 🎈Because of financial market imperfections, financial integration in neighboring, regional or global economies is therefore imperfect.
    - - 🎈Liberalization means elimination of state control over economic activities
      - 🎈It implies greater autonomy to the business enterprises in decision-making and removal of government interference
      - 🎈It was believed that the market forces of demand and supply would automatically operate to bring about greater efficiency and the economy would recover
    - - 🎈Globalization essentially means integration of the national economy with the world economy
      - 🎈It implies a free flow of information, ideas, technology, goods and services, capital and even people across different countries and societies
      - 🎈It increases connectivity between different markets in the form of trade, investments and cultural exchanges.