Trade, Investment and Competition in International Banking

208 Pages·2005·0.55 MB·English

by  Aidan O'Connor

Trade, Investment and
Competition in
International Banking
Aidan O’Connor
Trade, Investment and Competition in International Banking
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Trade, Investment and
Competition in International
Banking
Aidan O’Connor
© Aidan O’Connor 2005
All rights reserved. No reproduction, copy or transmission of this
publication may be made without written permission.
No paragraph of this publication may be reproduced, copied or
transmitted save with written permission or in accordance with
the provisions of the Copyright, Designs and Patents Act 1988, or
under the terms of any licence permitting limited copying issued
by the Copyright Licensing Agency, 90 Tottenham Court Road,
London W1T 4LP.
Any person who does any unauthorised act in relation to this
publication may be liable to criminal prosecution and civil claims
for damages.
The author has asserted his right to be identified as the author
of this work in accordance with the Copyright, Designs and
Patents Act 1988.
First published 2005 by
PALGRAVE MACMILLAN
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PALGRAVE MACMILLAN is the global academic imprint of the
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ISBN-13: 978–1–4039–4132–9 hardback
ISBN-10: 1–4039–4132–7 hardback
This book is printed on paper suitable for recycling and made
from fully managed and sustained forest sources.
A catalogue record for this book is available from the British
Library.
Library of Congress Cataloging-in-Publication Data
O’Connor, Aidan, 1955–
Trade, investment, and competition in international banking / by
Aidan O’Connor.
p. cm.
Includes bibliographical references and index.
ISBN 1–4039–4132–7
1. Banks and banking, International. 2. International finance.
I. Title.
HG3881.O268 2005
332.1′5–dc22 2005047293
10 9 8 7 6 5 4 3 2 1
14 13 12 11 10 09 08 07 06 05
Printed and bound in Great Britain by
Antony Rowe Ltd, Chippenham and Eastbourne
To the memory of my father
and
For my mother
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Contents
List of Tables x
List of Figures xiii
Acknowledgements xiv
Introduction 1
Part I The Evolution and Development of International
Banking 3
Chapter 1 International Banking in the Pre-Modern and
Modern Banking Eras 5
Developments in northern Italy 5
Northern Europe 6
Amsterdam and the onset of modern banking 8
The United Kingdom emerges as the leading
creditor country 9
France as a competitor creditor country 12
Germany finances industrial development 14
Switzerland’s internationally active banks and
capital exports 14
European banking systems and national
economies in the 19th century 15
The United States and the shift in economic
power and the centre of international finance 18
Japan’s modernisation and internationalisation 21
International financial centres in the late
19th century and early 20th century 23
The internationalisation of banks from the
19th century to the mid 20th century 27
Consortium banks 30
The onset of contemporary banking 32
vii
viii Contents
Part II The Characteristics of and Influences on
Contemporary International Banking 37
Chapter 2 Contemporary International Banking Markets 39
International money and capital markets 42
The euromarkets 43
The foreign exchange market 47
Derivative financial products 50
The gold market in London 56
Competition between intermediaries 58
The influence of institutional investors 61
Capital flows 64
Chapter 3 Regulation, Trade Agreements, Consolidation
and Integration in International Banking 70
Deregulation of financial markets 71
Capital adequacy 73
Liberalisation, international trade agreements
and international banking 75
Concentration in domestic banking markets 80
Cross-border mergers and acquisitions among
financial firms 82
Electronic banking 91
Part III Internationally Traded Banking Services 95
Chapter 4 Trade Theories and International Banking 97
Theories of international trade 99
Theories of international banking 102
International financial centres 107
Chapter 5 The Scope of International Banking, Business
Activities and Markets 117
International and foreign claims 118
International and multinational banking 120
Types of banks 125
Organisation type of foreign bank offices 130
Organisation structure and business description
of multinational banks 134
International banking and securities markets 145
Contents ix
Part IV Competitive Advantage in International
Banking 149
Chapter 6 The Leading International Banks 151
International banking market and product reach 151
Competitive advantage in services among
international banks 153
Part V The Evolving International Banking Industry 167
Chapter 7 Trends and Strategies of International Banks 169
Notes 176
Index 185