6 Chapter six International Banking and Money Market Chapter Objective: Differentiate between international bank and domestic bank operations and examine the differences of various international banking offices. Chapter Outline International Banking Services
Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.
Chapter sixInternational Banking and Money Market
2. Representative office
3. Foreign Branch
4. Subsidiary and Affiliate Bank
5. Offshore Banking Center
-min. cap. Requirements
-supervisory review process
Government obligations = 0%; short-term interbank assets = 20%
Residential mortgages = 50%; other assets = 100%
VAR = (PV)(s)(Z.01)(D1/2)
PV = portfolio value;
s = standard deviation of return(daily);
Z.01 = standard normal value for 1-tail confidence interval;
D = days
- loan interest rate is the interbank offered rate.
- interbank deposit interest rate is the interbank bid rate.