A bank as one country, which undertakes activities that involve it in some form of financial and banking business.

✅ Geographical Area
✅ Types of deposit they accept
✅ The loans and investment they make
✅ The currency of denomination of the transaction
✅ The residence of the bank customer

Integration
~ for international transfer of best practice in banking
~ for a more efficient use of resources
Globalization
~ Rapid development of telecommunications, transportation, facilities and infrastructure
Liberalization
~ Creates a borderless world
~ Steady increase in economic integrations at the global level

⭐ Social Integration
⭐ Racial integration
⭐ Economic integration
⭐ Educational integration
⭐ Regional Integration

Provide consulting services and advice
✅ foreign exchange hedging services
✅Profit
✅ Currency swamp financing
✅ International cash management service

🚩 Before 16th century mostly holding deposits and making loans
🚩 The evolution of banking and financial institutions started in 16th century
🚩 European bank expansion overseas more similar to the type of activity conducted nowadays
🚩 Various Japanese and Canadian banks also developed their global banking activities in late 19th and early 20th century's.
🚩As a trademark of colonial banks. British banks specifically set up to do business only.

🔒 Starting in 1960s and lasting 3 decades. Mainly related to international banking transaction among developed countries.
🔒Happens when the US banks began to expand out of the country to meet the financial requirements of Multinational Corporations (MNCs).
🔒 To take advantage of cheaper financing outside the local market and to gain competitive.
:took place upon the establishment of subsidiaries outside the US mainly in London.

🔒 Started in 1830s
🔒 They sold the underwritten securities activities in London to European investors
🔒 Expansion bank in overseas during the first half of the 20th century was slightly limited.

🔓 By the end of 1990s, IB was denominated by large banking and financial institutions specifically from the US, Japan, Germany, UK, France, Italy and Canada.
🔓 Universal banking, the ability to offer the full range of financial services one-stop centre for all related institutions.
🔓 Biggest challenge to invest in R&D. To implement new systems and to be entrepreneurs friendly.

Factors of International Growth.

1.Trade block - This will contribute toward growth because of benefits in term of economies of scale, cost of effective and increase in demand.

2. Low marginal cost - Marginal and marketing knowledge developed at home can be used abroad with low marginal cost.
3. Knowledge advantage

• Customer can be maintained
• Hybrid products and services can be introduced to cater local and foreign markets.
  4. Information services
• able to obtain information
  5. Prestige
• Multinational banks have a high perceived prestige, liquidity and deposit safety
  6. Banking regulation
• the government uses its own discretion, outside formalized legislation to influence banking sector operations.
  7.Multinational advantage
• Aim for profit
• have a larger pool potential customers
• Access to labour
  8. Transaction costs
• The firm prefer to locate their business near the larger market in order to minimize transaction cost.
  9. Market needs
• need to be creative and innovative
  10. Risk reduction
• Do business always at risk
  11. Economic Development
  -in developing countries must take into consideration the poor group
  12. Competitive market
• it is related to the degree of development of financial systems or increase competition
  13. Government policies
• Act as either a push or pull factor of IB
  14. Technological changes
• Improve the impact of economic integration on IB and connectivity among IB
  15.Growing diversity - Can be forms of culture, belief, gender, age and ethnics
  16. Economies of scale
• doing things more efficiently with increase the volume
  17. Conditions in host countries
• influence by the foreign bank decision
  18. Comparative advantage
• Have 4 areas: Industrialized operations. delivery transformation, returnon capital, asset protection
  19. Efficiency considerations
• there is little evidence that the banks international expansion could have contributed to economies of scope across different business lines.