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- There is ample evidence in the economic literature that cross-border expansion can also impose a cost on domestic banks in host countries, whose market share is threatened by the new entrants and who could take more risks with adverse consequences for the stability of the banking sector.
There is ample evidence in the economic literature that cross-border expansion can also impose a cost on domestic banks in host countries, whose market share is threatened by the new entrants and who could take more risks with adverse consequences for the stability of the banking sector.
- 194KB
- Sarah Alade
- 14
- 2014
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Does cross-border expansion impose a cost on domestic banks?
How does cross-border banking affect a country's financial system?
Do cross-border bank flows to nonbank borrowers increase?
How does monetary policy affect cross-border lending?
Apr 8, 2022 · (CDD) requirements have led some banks to shed their correspondent banking relationships with some smaller banks, often in emerging markets viewed as “high-risk” for AML. This phenomenon is known as “de-risking,” and according to the Bank for International Settlements (BIS), rising costs and uncertainty about how far CDD should go to
Oct 13, 2020 · This literature emphasizes the trade-offs between the benefits and costs of financial integration through cross-border banking, which depend on the interaction between home and host country factors as well as bank group features.
Searches related to Does cross-border expansion impose a cost on domestic banks?
Feb 10, 2021 · We combine the data on cross-border lending from the Bank for International Settlements (BIS) with data on bank credit to the domestic private nonbank sector (also from the BIS), and with data on bank credit to the domestic public sector (from national sources).
- Global Banks Retrench
- Financial Globalization Continues
- A More Stable Global Financial System Is Emerging, But There Are Still Risks
- Banks and Regulators Must Respond to The Dynamics of Cross-Border Finance
The most dramatic change in the postcrisis global financial system has been in cross-border lending. Large European banks—particularly those in the eurozone—are leading the retreat from foreign markets. Foreign claims of eurozone banks (including loans, other foreign assets, and lending by foreign subsidiaries) have declined by $7.3 trillion, or 45...
Despite the retrenchment of global banking, financial globalization continues. The global stock of foreign investment relative to GDP has changed little since 2007, standing at roughly 180 percent of world GDP. In absolute terms, total foreign investments have grown to $132 trillion in 2016, up from $103 trillion in 2007. More than one-quarter of e...
The new era of financial globalization promises more stability, for several reasons. 1. Foreign direct investment (FDI) and equity flows now command a much higher share of gross annual capital flows than before the crisis, from 36 percent before 2007 to 69 percent in 2016. This is good news for stability, since FDI is by far the least volatile type...
Financial globalization is arguably healthier than it was before the crisis, but banks and regulators must remain vigilant and continue to adapt. In the future digital platforms, blockchain, and machine learningmay transform financial markets and create new channels for cross-border capital flows. These technologies are enabling faster, lower-cost,...
Dec 1, 2021 · We argue that cross-border banking entry may induce an increase in competition by incentivising the domestic banks to react by adapting to the new market dynamics which include credit cost, products and technological innovations.
In fact, cross-border payments continue to be expensive, slow and lacking in trans-parency on both costs and delivery times. In 2015, a McKinsey survey on consumer cross-border payments found that consumers typi-cally pay a fee of €20 to €60 on top of the prevailing foreign-exchange spread.
