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INTRODUCTION TO INTERNATIONAL

BANKING
INTRODUCTION:

 International Banking sector occupies a central


position in the global economy . It has been
growing very swiftly over the year since
1960,this is because it has access to the
capital the technological capabilities and the
international network to facilitate these
activities .
INTERNATIONAL BANKING :

 International Banking that enables people to


live or work abroad to manage there finance in
one central location by keeping the money in
one place it allows to make transfers and
payments in several currencies from a stable
and secure offshore jurisdiction .
FUNCTIONS OF INTERNATIONAL BANKING:
 Low marginal cost
 Knowledge advantage
 Home nation information service
 Prestige
 Regulatory advantage
 Wholesale defensive strategy
 Retail defensive strategy
 Risk reduction
RISK IN FOREIGN EXCHANGE TRADING :
 Cross currency risk
 Risk of dealing and taking position
 Losses due to improper employee action
 Risk of default by counterparty
 International lending risk
 Country risk
 Credit risk
 Currency risk
 Foreign exchange risk
FUNCTIONS OF INTERNATIONAL BANKS:
 Linking the savers and borrowers of different
countries .
 Helping in foreign currency exchange Rate .
 Holding the inventories of foreign currency .
 Accepting deposits from savers
 Lending to the borrowers
 Borrow and lend in the euro currency market
 Provide consultancy and financing of international
trade.
SOURCES OF EXPORT FINANCING :

 Commercial Banks
 Export import bank of India

 Reserve Bank of India

 Export credit

 Guarantee corporation
FACTORS DETERMINING EXPORT FINANCING:

 Finance is needed to make sales


 The time for which the product is being financed

 The cost of financing

 Risk involved

 Pre shipment financing and post shipment


financing
 The need for pre shipment financing and for post
shipment working capital
OVERSEAS INVESTMENT FINANCE PROGRAMME:

 Export-oriented units and corporate Banking


 Pre-shipment /post-shipment credit programme
 Lending programme for export oriented units
 Finance through ministry of micro small and
medium enterprises
 Technology and innovation enhancement and
infrastructure development fund
 Lending programme for financing creative
economy
 Finance for grassroots enterprises
INTERNATIONAL PAYMENTS SYSTEMS:

 International payment system is a payment


instruction which is communicated from a
customer in one country to a local currency
account in another country .A payment is then
provided from the local currency account to a
destination /beneficiary account of an intended
beneficiary.
THANK YOU

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