- is just like any other banking service, but it takes place across different nations or internationally. - To put it another way, it is an arrangement of financial services by a residential bank of one country to the residents of another country. - Most multinational companies and individuals use this banking facility for transacting.

offer opportunities to the traders and corporate and multinational companies, to expand their business, across different parts of the globe. International investors explore more investment avenues for their investments.

in the financial sector offers a wide range of opportunities for expansion of trade and financial activities across the borders of nations.

can be defined as a sub-set of commercial banking transactions and activity having a cross-border and/or cross currency element.

refers to the location and ownership of banking facilities in a large number of countries and geographic regions.

comprises a range of transactions that can be distinguished from purely domestic operations by (a) the currency of denomination of the transaction, (b) the residence of the bank customer and (c) the location of the booking office.

International Banking assists traders to expand their business and trade activities beyond the boundaries of a nation. - Economic growth and conducive climate for carrying out the business activities in new nations are the factors because of which many enterprises are looking beyond the borders of their own nations for their business growth. - Competitive advantages in respect of price, demand and supply factors, future growth opportunities, cost of production and operating costs, etc., are some of the other important factors for expansion of international trade and finance. - In view of this, the presence of banks across the nations have led to the growth of international banking.

Flexible legal and regulatory framework encourages traders and investors to enter into the international markets. - Quick approval to set up business, less complicated compliance requirements and stable political situations help many new players to enter into a number of nations to expand their activities - Also, due to lesser tax rates or no taxes to be payable, certain tax havens play important roles as off shore banking centers which encourages many international banking units to open their branches in such off shore centers.

- The operating efficiency of an enterprise depends upon the average cost of capital. Many companies enter into new emerging markets to take advantages of the lower cost of capital in such markets. - Banks as a financial intermediary play an important role as source of funds. Banks through their professional skills take advantage of the arbitrage opportunity in different international markets and increase their profits.

Banks play crucial role in export and import trade. - By providing different types of financial and non financial support, banks help enterprises, corporate customers and individuals doing business in different countries, by extending trade finance and investment opportunities. - Banks also facilitate movement of funds (inward and outward remittances) through their network and correspondent banking arrangements.

paved ways for diversification, thereby global investors look for alternative destinations to invest their savings with twin objectives of safety of funds and better returns. - In view of their presence in different time zones, international banks also face various risks

- International banking facility provides flexibility to multinational companies to deal in multiple currencies. - The major currencies that multinational companies or individuals can deal with include the euro, dollar, pounds, sterling, and rupee. - The companies having headquarters in other countries can manage their bank accounts and avail of financial services in other countries through international banking without any hassle.

International banking provides accessibility and ease of doing business to companies from different countries. - An individual or MNC can use their money anywhere around the world. - This gives them the freedom to transact and use their money to meet any requirement of funds in any part of the world. - International banking allows the business to make international bill payments. - The currency conversion facility allows the companies to pay and receive money easily. - Also, benefits like overdraft facilities, loans, deposits, etc. are available every time for overseas transactions.

- A multinational company can maintain the records of global accounts in a fair manner with the help of international banking. - All the transactions of the company are recorded in the books of banks across the globe. - By compiling the data and figures, the accounts of the company can be maintained.

- and growing economies around the world have led to the development of international banking facilities. - The world is now a marketplace and each business wants to exploit it. Geographical boundaries are no more a concern. With access to technology, banking facilities have grown vastly. - One prime example of it is international banking. In the years to come, such banks would see higher growth and higher profitability. - Big business houses are expanding themselves at a rapid pace. - To maintain the growth, these businesses will need the financial services of international banking. Therefore, the demand for its facilities will increase.

An international bank arranges the finance for the traders who want o deal with the foreign country.

The core services provided by the international bank are to arrange a foreign exchange for the import-export purpose.

The international bank hedge the funds by buying the securities at the lower price level and sell it when the price level rising.

It also offers an investment banking services by signing underwriting of shares, financial decisions for investment.

Established when two banks maintain a correspondent bank account with one another. The correspondent banking system provides a means for a bank’s MNC clients to conduct business worldwide through his local bank or its contacts.

- A small service facility staffed by parent bank personnel that is designed to assist MNC clients of the parent bank in its dealings with the bank’s correspondents. It is a way for the parent bank to provide its MNC clients with a level of service greater than that provided through merely a correspondent relationship.

Operates as a local bank, but legally it is a part of the parent bank. - As such, a branch bank is subject to the banking regulations of its home country and the country in which it operates. - The primary reason a parent bank would establish a foreign branch is that it can provide a much fuller range of services for its MNC customers through a branch office than it can through a representative office.

is a locally incorporated bank that is either wholly-owned or owned in major part by a foreign subsidiary. - An affiliate bank is one that is only partially owned but not controlled by its foreign parent. - Both subsidiary and affiliate banks operate under the banking laws of the country in which they are incorporated.

- involve the relationship between different banks which are in different countries. - This type of bank is generally used by the multinational companies for their international banking. - This type of banks is in small size and provides service to those clients who are out of their country.

based on the constitutional amendment of 1919. They will operate business internationally under the amendment.

- It is a type of banking sector which allows foreign accounts. - is free from the banking regulation of that particular country. - It provides all types of products and services.

the banks which incorporate in one country which is either partially or completely owned by a parent bank in another country. - The affiliates are somewhat different from the subsidiaries like it is not owned by a parent bank and it works independently.

the banks which are legally tied up with the parent bank but operate in a foreign nation. -follows the rules and regulations of both the countries i.e. home country and a host country.

Managerial and marketing knowledge developed at home can be used abroad with low marginal costs.

– The foreign bank subsidiary can draw on the parent bank’s knowledge of personal contacts and credit investigations for use in that foreign market.

Local firms in a foreign market may be able to obtain more complete information on trade and financial markets in the multinational bank’s home nation than is obtainable from foreign domestic banks.

Very large multinational banks have high perceived ________, which can be attractive to new clients.

Multinational banks are often not subject to the same regulations as domestic Banks

Banks follow their multinational customers abroad to avoid losing their business at home and abroad.

Multinational banks also compete for retail services such as travellers checks and the tourist and foreign business market.

Multinational banks may be able to circumvent government currency controls.

Foreign markets may offer opportunities for growth not found domestically.

Greater stability of earnings with diversification