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Page No.
INTRODUCTION 4
ECONOMIC ROLE OF BANKS............................... 5
INTERNATIONAL BANKING OPERATIONS 7
OFFSHORE FINANCIAL CENTERS. 11
LEADING INTERNATIONAL BANKS. 16
WORLD BANK. 17
HSBC.. 29
STANDARD CHARTERED... 38
AMERICAN EXPRESS BANK.. 40
BIBLIOGRAPHY. 59
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INTRODUCTION:
Money and currency are very strange things. They keep going up and
down and no one knows why. You want to win but you lose no matter
how hard you try.
Banking, the business of providing financial services to
consumers and businesses. The basic services a bank provides
are checking accounts, which can be used like money to make
payments and purchase goods and services; savings accounts
and time deposits that can be used to save money for future use;
loans that consumers and businesses can use to purchase goods
and services; and basic cash management services such as
check cashing and foreign currency exchange. A broader
definition of a bank is any financial institution that receives,
collects, transfers, pays, exchanges, lends, invests, or safeguards
money for its customers.
ECONOMIC ROLE OF BANKS
Banking is like any other form of economic activity. Like othereconomic agents, banks are both dealers and producers. They aredealers, in the sense that they bring together lenders and borrowers, andthey are producers as they transform raw base money or cash issued bythe government into more convenient checks or demand deposits, whichhave greater security than cash, and also they transform short-termdeposits into longer-term loans. In the process they do the financialintermediation and maintain liquidity in the system.
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RISK REDUCTIONIn their role as dealers, bankers help to reduce risk in the economy.There are two types of risk: the more familiar default risk and the lessfamiliar withdrawal risk. In reducing these risks, banks make their
profits. Let us consider default risk. A would-be supplier of credit, orlender-creditor, wishes to make a loan, in order to earn interest on excesscash-balances. The creditor may search out prospective borrowers fromamong the public. But the creditor must evaluate the individual risks ofdefault. Further, to the normal costs of acquiring information, there isthe higher risk of concentrating the loan with one or a few individuals.Because of this, the creditor would charge a high interest rate on thisloan, in order to compensate for the risk. By going to a bank, with a
long-standing reputation and a diversified portfolio of assets, the creditormarkedly reduces the risk of any default on the loan. The rate of interestshould be lower in this case.
INTERMEDIATION AND INTEREST RATE EXPECTATIONS
Banks do financial intermediation as they transform short-term depositsinto longer-term assets or loans. Typically, short-term deposits are lessrisky for depositors, and so they require a lower rate of interest. Longer-term loans, on the other hand, offer borrowers a lower risk ofwithdrawal, so borrowers will be willing to pay a higher interest rate tothe bank. For this reason, banks usually transform short-term liabilities(deposits) into longer-term assets (loans).
The banks generally borrow short to finance long term assets and
use this leverage to earn the spreads which accrue to them as income.They borrow short through a sequence of, say, two one-period deposits,offering rates r1 now and expected rate r2 next period. Again, the bankscan borrow long. On the lending side, the bank can offer a two-periodloan at an interest rate I, or it can extend a sequence of two one-periodloans at interest rates i1 now, and expected interest rate i2 next period.
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The time management of both deposits and credit portfolio willdepend on the difference between the short term interest and long termones. The business of the banks is the quantum of spreads that is definedas the difference between the average returns from the created assets and
average costs of deposits.
INTERNATIONAL BANKING OPERATIONSInternational banking operations are essentially to facilitate the movementof goods across the political boundary of countries. Banking system camealong with the development of money as an institution. As civilizationnarrowed down the social distances and mankind learned about the
benefits of exchanging commodities across political boundaries, thepresent-day international trade developed. The transaction ofcommodities across countries required financial intermediation in theinternational level and thus international banking business was born. Whatstarted with movement of gold and silver across country-borders becameultimately an efficient institution of international transfer of not onlyyellow metal but the currencies of sovereign countries. In this way theemergence and growth of international banking is closely interwoven withthe development of international trade and international capital movement.
The above gives the general perspective of the growth ofinternational banking. But there are many aspects of this development.From a historical standpoint, the recent growth of international bankingcan be regarded as a reversion to the situation before World War I whenEuropean banks dominated the world capital market. During the period1940-1960 regulatory control on capital flow and convertibility of thecurrencies reduced the importance of international banking. From 1960
onwards globalization of capital market started and the emergence ofsurplus in petro-dollars in the seventies gave the much needed liquidity tothe international banking business. The latter has been characterized byan increasing turnover in international trade, a phenomenal increase in theinternational flow of capital and also an increasing flow of funds from thebanks to non-bank sectors. To understand the causative factors properly
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the literature has attempted to identify the factors supporting theinternationalization of banking business. Thus factors like non-financialmultinational corporations, the proximity to customers abroad, thecompetitive advantage with better information technology and the benefits
due to international diversification have been mentioned in the literature inthe contexts when these become relevant.
These factors along with other forces of globalization have established thehuge international financial architecture which rule the internationalfinancial market today. The theoretical studies mentioning the factorshelping the expansion of international banking are important, but intoday's scenario the major business of international banks is based on
international trade , international transfer of capital and money andderivatives.
The literature abounds in the exploration of the causative linkin the development of international banking, but not many studies arefound testing the theory empirically. There have been several studieswhich attempt to measure empirically the role of the different factorsbehind the growth of the US banks in the international fields.
DETERMINANTS OF INTERNATIONAL BANKING ACTIVITYIn today's world no country can afford to be autarkic either in the
field of international trade or in international banking. But the latter issubject to much more restrictions in almost all the countries compared tothe former. What determines the growth of international banks in thedomestic banking sector of a particular country? Analytically we canproceed as follows:
Since international trade is closely related to international banking,volume of international trade (imports and exports together) is adeterminant of the growth of international banking and the relationship isdirect. Assuming that no specific restrictions are imposed on theoperation of foreign banks so far as their operations are concerned ininternational banking vis--vis the practice of international banking done
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by home country's banks, it can be said that an increase in the turnover ofinternational trade should have positive impact on the growth ofinternational banking. Alternatively, the ratio of export to gross domesticproduct can be taken as the explanatory variable. This alternative
formulation can be tested.Foreign direct investment has been cited as an important
determinant for the expansion of international banking. In fact, thepresence of international banks facilitates the inflow of foreign capital andit is expected that the increase in foreign direct investment should have apositive impact on the growth of international banking.
Banking service as a commodity is supposed to have positive
income elasticity. As national income is growing, demand for bankingservice should increase. To what extent the increase in income will helpthe growth of foreign banking activity in domestic soil depends on thepreference of the consumers and also the participation of the foreign banksin the trade, both domestic and international, of the host country. If wetake per capita income as the explanatory variable for the growth ofinternational banking activity, then the growth of per capita income mayfacilitate the growth of international banking in the host country on theassumption that foreign banks have complementary role in the domesticbanking structure.
The growth of domestic deposit should have influence on theactivity of foreign banks. But in many countries the foreign banks are notallowed to create a domestic deposit base, though this facility is crucial forthe increase in business. Foreign banks often face difficulties in thecreation of domestic deposit base even when it is allowed, as the cost ofthe maintenance of deposits may be too high compared to business. Many
foreign branches of Indian banks operating abroad have not created thedomestic deposit base for this reason.
An increase in domestic deposit is supposed to have positiveinfluence on the deposit mobilization of all banks including the foreignbanks. That helps the building up of the asset portfolio. To what extentdeposit mobilization will affect the activities of foreign banks depends on
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the competition between domestic banks and the foreign banks in the hostcountry. Foreign banks prefer the creation of a domestic deposit base inthe domestic currency as this helps in the expansion of business. Manycountries do not allow the foreign banks to create a domestic base, as the
latter is perceived to help the foreign bank to mount an attack on thedomestic currency.
Again, the exchange rate changes affect the activities of theforeign banks. An increased volatility of the exchange rate increases therisk factor in international banking, and unless this aspect is properlytaken care of, this acts negatively so far as the growth of internationalbanking is concerned. We are to understand that the balance- sheet of theforeign banks in the head office is in their mother currency. If Indian
rupee appreciates vis--vis their mother currency, that would show agood results in their foreign operations.
An index of activity of foreign banks may be their aggregateasset structure, though the number of branches may be another indicator.Some studies take both. We find that the expansion of internationalbanking in a country depends on several factors like importance of trade inGDP, the dynamism of the exchange rates, the deposit base and someothers as explained in earlier paragraphs. The literature also examines thequantitative strength of different variables using an econometric modelWe will pursue here another type of international banking activity whichis conducted in offshore areas and specially tax-haven locations.
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OFFSHORE FINANCIAL CENTRES
An offshore financial centre (or OFC), although not precisely defined,is usually a small, low-tax jurisdiction specialising in providing thecorporate and commercial services to non-residents in the form of
offshore companies and the investment of offshore funds.
Why Offshore Finance Centre a Preferred Destination
In some situations very small nations with good infrastructures andstrategic locations create offshore financial centres (OFC) as a matter ofpolicy to attract foreign capital so as to invest the same for the growth ofdomestic economy. These countries hardly known outside the region haveescaped the agony of poverty through this process of foreign capital
investment.During last two decades many OFCs have been created as part of the
developing countries efforts to initiate economic growth in their smalldomestic markets through the provisions of international financialservices. These OFCs are classified alon a spectrum of notional OFC tofunctional OFCs. While the former provide minimal financial services
other that simply being a jurisdiction in which nameplate operation of thecompanies can be established, the latter provide a wide range of value
added services. Notional OFCs are costless to establish, and for thatcompetition among tiny states is tough, and it contributes little to theeconomic development of the region.
The functional OFC require elaborate infrastructure likecommunication, airport, labour force and all these call for largeinvestment. As a result the region experiences over all economic growthand the real economies surrounding the region are benefited through
backward and forward linkages.
The OFCs, with support from the local government, offer a largenumber of services to the potential investors in their banking system andthese are :
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excellent communication links with the outside world absence of any tax burden [ or even when tax exists, it is bare
minimum]
non existence of any treaty to exchange tax information withother countries
predominant use of major world currencies no exchange control the facility to disguise the ownership of corporate vehicles
through the use of nominee directors and bearer shares
no reporting requirements for companies like annual reports no system of supervision of companies such as Annual General
Meetings.
Maintenance of secrecy and confidentiality
The list is long and the main idea is to give all facilities to the foreigninvestors so that OFC can earn money by selling confidentiality.
A small sub-category of offshore banks exists in the tax-haven areaslike Cayman Island, Nassau, Bahamas, Bahrain, Monaco, Andorra etc. Alloffshore centers have the common denominators of customer
confidentiality, very low taxes on offshore business and an absence offoreign exchange control. However, the activities in the centers varydepending on location, convenience to other financial markets, legal andaccounting matters and communications. Some of the specialized servicesare the following: company formation and management, administrativeservices for "paper' branch and subsidiary banks, portfolio managementfor trusts, Euro- bond underwriting and placement, incorporation andmanagement of captive insurance companies, ship registration, storage
and transshipment of merchandise etc. Thus in today's world ofglobalization the offshore centers have assumed great significance.
One should be clear about the difference between a tax haven andoffshore centers. A tax haven is a jurisdiction with a high level of bankingand commercial secrecy through which businesses or individuals can hold
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assets and earnings and move the same to other places and differentjurisdictions with little or no tax impact. While many offshore financialcenters are tax havens, many are not. These two are different and thisshould not be confused. Perhaps the governments in the countries creating
the offshore financial centers would like to state that these centres operatein tax efficient zones and these are created to derive benefits of large scalemovement of finance capital.
Capital flight and so called money laundering are two phenomenafrom which the developing countries suffer most. The offshore financialcenters in tax haven regions are often the conduit for the large scaletransfer of funds. The mechanism of transfer and volumes have beenstudied in the literature .
Panama: an Offshore Center
Panama is an independent republic with no exchange control and avery liberal tax laws. It is bilingual, as both English and Spanishlanguages are used here. It has a very good infrastructure both in airtransport and telecommunications. There are a large number of local andforeign financial institutions and also a large spectrum of legal andaccounting expertise. The banking secrecy is protected by various laws.There is no tax on offshore business and its legal system is wellestablished. Panama has a long tradition in commercial banking andoffshore business. The legal system is liberal in the incorporation ofcompanies, Eurocurrency business, banking secrecy and private banking.The huge amount of capital deposited in the banks here are often used inthe domestic investment. Also the fees generated in the business and thesmall level of taxes facilitate the generation of income and employment.Of course, a large amount of cash of doubtful origin pass through theOFCs like Panama and this is part of international money laundering
nexus.
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The Isle of Man : Offshore Financial Centre
The Isle of Man is outside the sovereign jurisdiction of UnitedKingdom. It is in the centre of Irish Sea and eighty miles away from
Manchester. This tiny territory has its own government for the last 1200years and it has obtained the status of an offshore centre. This island takespride in its numerous attractions along with its ability of providing a safetax- free environment for the investors. The well established companylaws of the island allow a variety of corporate vehicles includingcompanies limited by guarantee and hybrid companies, and alsocompanies limited by share capital.
Companies that are not owned by the residents of the Isle of Man
(IM) and those that conduct their business completely outside the IM,even if they may have an office there, are granted exemption from all IMincome taxes. Non- resident companies from other jurisdictions likePanama or Irish non-resident can maintain their base at IM and can applyfor IM residency under Part F of Isle of Man Companies Act, and theyare eligible for income tax exemption. The ownership of the companiesneed not be a matter of public record, and this way complete secrecy canbe maintained.. The companies can carry on lawful business in anycountry and in any currency that they desire according to theirconvenience.
The island has an excellent financial infrastructure, and most banks,accountants and insurance companies are represented there. For example,Ulster Bank (Isle of Man) Limited is a wholly owned subsidiary of UlsterBank Limited, and the latter is a member of Nat West Group, which is one
of the world's largest banking organization. Under the rule of the FinancialSupervision Commission responsible for the Depositors CompensationScheme, deposits are protected up to 75 per cent of the first GBP 20,000per depositor. The investors are offered several options regarding theopening of account, the variations in minimum amount, minimumwithdrawal and interest rate structure. For example, an investor can keep
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money in fixed deposits, the time may vary from one week to five years atan interest rate which is known in the beginning.
Some of the leading international banks : World bank
HSBC
Standard chartered bank
City bank
Abn-amro bank
Bank of Ceylon BNP pabris bank
JP morgan chase bank
American Express bank
Deutsche Bank
THE WORLD BANK GROUP
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Todays world is both very rich and very poor. Around 2.8 billion
people more than half the people in developing countries live on less
than US$2 a day. Of these, 1.2 billion people earn less than US$1 day.
The challenge of reducing these levels ofpoverty, while the worlds
population continues to grow by an estimated 3 billion people over the
next 50 years, is enormous.
They work to reduce poverty worldwide by:
Promoting growth to create employment opportunities; and Helping poor people to take advantage of these opportunities.
Their support governments of member countries in their efforts to invest
in schools and health centers, provide water and electricity, fight disease
and protect the environment. They are not a bank in the common sense
but an international organization owned by the 184 countries both
developed and developing that are their members. They were set up in
1944 as the International Bank for Reconstruction and Development.
When they first began operations in 1946, they had 38 members. That
number increased sharply in the 1950s and 1960s, when many countries
became independent nations and joined the organization.
As their members grew and their needs changed, they expanded and are
now made up of five different agencies. They are like a cooperative,
where their members are shareholders. Through the representatives on
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their Board of Executive Directors, these countries set the policy,
oversee the operations and benefit from the work.
They are one of the worlds largest sources of funding and knowledge
for developing countries. Their main focus is on helping the poorest
people and the poorest countries. They use their financial resources, staff
and extensive experience to help developing countries reduce poverty,
increase economic growth and improve their quality of life.
Assessing the effect of projects they support is essential in developing
countries. Resources are scarce so they use them where they can have
the largest effect. Monitoring helps project managers know if programs
are reaching the people they are aimed at or if these programs are
ineffective and wasteful. The emphasis on monitoring and assessment is
part of their focus on actual results for poor people and on continuous
learning about what does and does not work for future advice and
support.
Over the past 60 years, they have learned that development solutions
need to be designed by countries to suit their own circumstances onesize does not fit all. They bring a mix of money and knowledge to
encourage economic and social development, and help countries to
achieve the internationally agreed Millennium Development Goals.
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They work in partnership with more than 100 developing countries and
are involved in many different areas. Projects they have supported help
these countries to invest in health and education, fight corruption, boost
agricultural production, build roads and ports and protect the
environment. Other projects are aimed at rebuilding war-torn countries
or regions, providing basic services such as clean water, or encouraging
investments that create jobs. In the fiscal year that ended on June 30,
2005, the Board approved US$22.3 billion in loans and grants for 278
projects.WHO RUNS THE WORLD BANK?
The World Bank is run like a cooperative, with their member countries
as shareholders. The number of shares a country has is based roughly on
the size of its economy. The United States is the largest single
shareholder, with 16.41 percent of the votes, followed by Japan 7.87
percent, Germany 4.49 percent, the United Kingdom 4.31 percent and
France 4.31 percent. The rest of the shares are divided among the other
member countries.
ULTIMATE DECISION-MAKING AUTHORITY
Their government shareholders are represented by a Board ofGovernors. Generally, these governors are ministers, such as Ministers
of Finance or Ministers of Development. The governors have the
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ultimate responsibility for making decisions, and meet once a year
during the Annual Meetings.
DAY-TO-DAY DECISIONS
Because the governors meet only once a year, they give specific duties
to their Executive Directors, who work on-site at the Bank. Every
member government is represented by an Executive Director. The five
largest shareholders France, Germany, Japan, the United Kingdom and
the United States appoint an executive director each, while other
member countries are represented by 19 Executive Directors. The 24Executive Directors make up the Board of Directors. They normally
meet twice a week to oversee the business, including approving loans
and guarantees; new policies; the administrative budget; country support
strategies; and borrowing and financial decisions. The president is, by
tradition, a national of the largest shareholder the United States. Elected
for a five-year term which can be renewed, the president chairs the
meetings of their Board of Directors and is responsible for overall
management. Their current president is Paul Wolfowitz, who came into
office on June 1, 2005. The World Bank employs around 10,000 people,
including economists, educators, environmental scientists, financial
analysts, anthropologists, engineers and many others. Their employeescome from about 160 different countries, and over 3,000 staff work in
offices around the world. There has been a move to place more staff in
member countries, where they can work closely with their clients.
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FIVE AGENCIESONE GROUP
INTERNATIONAL BANK FOR RECONSTRUCTION AND
DEVELOPMENT
The International Bank for Reconstruction and Development IBRD
provides loans and development assistance to middle income
countries in Latin America, Asia, Africa and Eastern Europe. IBRD
gets most of its funds by selling bonds in international capital
markets.
INTERNATIONAL DEVELOPMENT ASSOCIATION
The International Development Association IDA plays an
important role in their mission to reduce poverty. Its support is
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focused on the poorest countries, to which it provides interest-free
loans and grants. IDA depends on contributions from its wealthier
member countries including some developing countries for most
of its financial resources.
INTERNATIONAL FINANCE CORPORATION
The International Finance Corporation IFC promotes growth in the
developing world by financing private-sector investments and providing
technical support and advice to governments and businesses. In
partnership with private investors, IFC provides loans and equity finance
for business ventures in developing countries.
WHERE DOES THE MONEY COME FROM?
IBRD main lending agency raises most of its money in the worldsfinancial markets by selling their AAA-rated World Bank bonds, usually
to financial institutions, pension funds and other institutional money
managers, as well as to central banks. In fiscal 2003, IBRD raised
US$17 billion in financial markets. However, unlike other financial
institutions, they do not operate for profit. They use their high credit
rating to pass the low interest they pay for their finance to their
developing country borrowers. They earn interest and fee income on the
loans, and income on the liquid asset investments and capital that is paid
in by their member country shareholders. These earnings, as well as the
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funds raised on the capital markets and part of the paid-in capital and
reserves, are used to make loans to their member countries and to cover
their administrative expenses. IDA funds, which account for about one-
quarter of all of their lending, provide the poorest countries with
interest-free loans and grants. Some 40 donor countries replenish the
IDA facility the worlds largest source of interest-free assistance to poor
countries every three years, allowing them to continue their programs.
IDA also helps mobilize and coordinate aid from donor countries and
other international organizations. The fund was replenished mostrecently in 2002, with about US$23 billion to poor countries over the
three-year period which began on July 1, 2002. About half of the funds
came from donors, with the rest coming from non-donor resources
including IDA repayments and net income transfers from IBRD. Donors
decided at that t time that more of this money up to one-fifth will be
given as grants which dont have to be paid back, instead of interest-free
loans. The grants will make it easier for countries to deal with
development crises such as the HIV/AIDS epidemic. Outside of IDA,
very little of the income is provided by member countries 5 percent of
IBRDs funds around US$13 billion have come from contributions of
rich countries, paid in when they joined the Bank. MIGA is capitalizedby its member countries and receives operating capital from the
Bank. The agency also charges fees for some of its services. IFC
provides a mix of financing loans, equity finance, risk
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management products, and intermediary finance, among others
for each of its projects. However, most of its funding, as well as
leadership and management responsibility, comes from private
sector owners. IFC operates on a commercial basis. It invests
only in for-profit projects and charges market rates for its products
and services.
WHERE DOES THE MONEY GO?
Their main job is to use the money in ways that benefit developing
countries. They provide these funds at zero or low-interest rates,
or as grants to countries that have no access to international
markets. Member countries also come for economic research,
policy advice, and technical assistance in designing and carrying
out development projects. The countries design their ownprograms with technical support from the staff. However, the
programs must have specific development targets such as
reducing poverty, and delivering social services, among others.
The type of financing available to a developing country depends
on its level of need. Countries that borrow from IBRD are
generally middle income countries, where income for each person
is less than US$5185 a year. Seventy-five percent of the worlds
poorest people those who live on less than US$1 a day live in
these countries, which can only borrow from the private markets
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at unfavorable rates. IBRD offers them loans at better terms and
with longer repayment periods. The worlds poorest countries
those where income for each person is
US$875 or less receives grants and interest-free loans from for
projects to provide basic services. In the case of the loans,
countries have 35 to 40 years to repay, with a 10- year grace
period. Revenues from the operations go into reserves, which
have a high level of financial protection and help to fund major
sources of assistance, such as IDA and debt relief. By creatingIFC and MIGA, IBRD tried to make things fairer for developing
countries and make them more attractive to investors. IFC works
with the private sector in developing countries. It takes a minority
stake in a private company in order to attract private investors.
MIGA guarantees insure investors and lenders against financial
and political risk in developing countries, offering cover against
non-commercial risks such as war and civil disturbance.
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HOW THE LOANS ARE MADE
They offer two basic types of loans: investment loans for goods,
work and services to support economic and social developmentprojects in a broad range of sectors; and adjustment loans to
support policy and institutional reforms. During loan negotiations,
they agree with the borrower on the development objective of the
project or program, outputs, performance indicators to measure
the impact and success of the project and a plan to put it all into
practice. Once they approve the loan and it becomes effective,
the borrower puts the project or program into practice according
to the terms agreed with them.
They supervise how each loan is used and evaluate the results.
All loans are governed by the operational policies, which make
sure that operations they fund are economically, financially,socially and environmentally sound.
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FUTURE PLANNING OF THE HSBC COMPANY
STRATEGY:
HSBCs strategy reflects its position as The Worlds Local Bankand is focused on delivering superior growth and earnings overtime by building on the Groups heritage, skills and investment. Inparticular, the group aims to leverage the HSBC brand andnetwork to reach new customers and offer more services toexisting customers, to maximize efficiency by taking advantage oflocal, regional and global economies of scale and to ensure staffare engaged by aligning objectives and incentives.
BEST PLACE TO BANK STRATEGY-----Central to theway the bank applies Group strategy is the developmentof the Best Place to Bank strategy, which is made up ofthree principles, which incorporate every aspect of thegroups relationship with customers, including treatingthem fairly: Make Better Products, Sell Them Properly,
and Keep Them Sold. It is the banks aim that everythingthe bank does should be driven by all of these principlesand that when the bank consistently makes betterproducts, sells them properly and keeps them sold, it willbe the Best Place To Bank.
BEST PLACE TO WORK STRATEGY---Following thesame concept, the bank introduced a Best Place to Work
strategy, which emphasises performance management,reward, personal development aligned to businessstrategy and operating plans, a performance-drivenculture and an engaged workforce.
HSBCs strategy is to be a leading wholesale bank by:
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utilizing HSBCs extensive distribution network;
developing Global Banking and Markets hub-and-
spoke business model as the foundation on which thebusiness can best meet its clients needs.
continuing to build skills and capabilities in its majorcenters to support the delivery of an advanced suite ofservices to corporate, institutional and governmentclients across the HSBC network.
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STANDARD CHARTERED
Standard Chartered was formed in 1969 through a merger of two banks:The Standard Bank of British South Africa, founded in 1863, and theChartered Bank of India, Australia and China, founded in 1853.
Both companies were keen to capitalize on the huge expansion of tradeand to earn the handsome profits to be made from financing themovement of goods between Europe, Asia and Africa.
The Chartered bank was founded by James Wilson following the grant
of a Royal Charter by Queen Victoria in 1853. Chartered opened its firstbranches in Mumbai (Bombay), Kolkata and Shanghai in 1858, followedby Hong Kong and Singapore in 1859.The Standard Bank wasfounded in the Cape Province of South Africa in1862 by John Paterson. It was a commenced business in Port Elizabeth,in January 1863. It was prominent in financing the development of thediamond fields of Kimberley from 1867 and later extended its networkfurther north to the new town of Johannesburg when gold was
discovered there in 1885. It expanded in Southern, Central and EasternAfrica and, by 1953, had 600 offices. In 1965, it merged with the Bankof West Africa, expanding its operations into Cameroon, Gambia,Ghana, Nigeria and Sierra Leone.
From the early 1990s, Standard Chartered has focused on developing itsstrong franchises in Asia, Africa and the Middle East. It hasconcentrated on consumer, corporate and institutional banking and onthe provision of treasury services - areas in which the Group had
particular strength and expertise.
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It has network of over 1,700 branches and outletsfocuses on consumer, corporate, and institutional banking, and on
the provision of treasury servicesStandard Chartered Bank has been actively engaged in
acquisitions and expansionThe Standard chartered credit cards come with varied categories
and each category has some attractive featuresStandard chartered was the first issues a global card in India, i.e.
photo cardStrong Brand name- worldwide presence.Standard Chartered carried regular marketing research.Strategic management of Standard Chartered bank was great
motivator of employees.They did aggressive marketing in terms of sales promotion and
direct sales.More focus on technology and telecommunication (ATM Network,
APS, Quality System)Standard Chartered has been able to sustain its legacy of being
hailed as a trusted provider of credit services to the modern-daycustomers
Highly trained and motivated sales forceStandard chartered is growing at the rate of 37% which is higher
than the market rate of 33%Biggest acquirer of Asian banking assets
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AMERICAN EXPRESS BANK
INTRODUCTION
American Express Bank has presence in over 150 countries. It is a
diversified travel and financial services company. Established in 1850 in
New York, American Express Company was among the first and most
successful express delivery businesses to arise during the rapid westward
expansion of the United States.
American Express India was established in 1921 providing high quality
travel and financial services. American Express in India is the largest
company to have wide network of travel locations in the country.
American Express Travels has entered into a Memorandum of
Understanding (MoU) with Department of Post to enable the designated
Speed Post offices in distributing and encashing American Express
Travelers Cheques.
American Express Travelers Cheques are available in the following
currencies:
Australian Dollar
Canadian Dollar
Euro
Japanese Yen
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Saudi Riyal
South African Rand
Swiss Franc
Pound Sterling
US Dollar
HISTORY
Since its founding in 1850, American Express has conducted business
according to several guiding principles that over the years have becomeinextricably linked with the companys brand, products, services and
perhaps most notably its people. Generations before the phrase
company values entered the corporate lexicon; American Express
employees across the organization were demonstrating the same core
principles upheld by the company today.
American Express operates in over130 countries around the globe.
Established in 1850 in New York City, American Express Company was
among the first and most successful express delivery businesses to arise
during the rapid westward expansion of the United States.
The history of American Express is a fascinating one, filled with
interested and sometimes quirky characters that through a combination
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of brains, perseverance and luck shaped the companys development
during the past century and a half.
The express company that forwarded freight and valuables evolved into
a company that created and sold financial products like money orders
and travelers cheques. Following an era of international expansion, the
company became an entity perhaps best known for its charge card.
Today, American Express is a global payments company.
The attributes that today are the hallmarks of the American Express
brand trust, integrity, and security, quality, and customer service -- all
have their roots in this compelling story. In this history, as well, are the
genesis and development of the company's aspiration to become the
world's most respected service brand.
PEOPLE BEHIND AMEX
American Express was founded in 1850 by Henry Wells, William Fargo,
and John Butterfield as an express business. In 1882, American Express
launched its money order business to compete with the US Post Office'smoney orders. This product quickly spread to Europe where no such
financial product existed. Sometime between 1888 and 1890, J. C. Fargo
took a trip to Europe and returned frustrated and infuriated. American
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Express India was established in 1921 providing high quality travel and
financial services. American Express in India is the largest company to
have wide network of travel locations in the country. American Express
Travels has entered into a Memorandum of Understanding (MoU) with
Department of Post to enable the designated Speed Post offices in
distributing and encashing American Express Travelers Cheques.
W. Richard Holmes has been elected chairman of American Express
Bank, Ltd., (AEB) American Express Company's international bankingsubsidiary, based in New York. He adds this title to his current one of
chief executive officer of AEB, a role he assumed in June, 2000. As
chairman, he succeeds James Cracchiolo, who has stepped down as
chairman of AEB to work full-time with the Company to complete the
spin-off of American Express Financial Advisors (AEFA).
William J. Blomquist, currently managing director and head of AEB's
Financial Institutions Group, and Sergio J. Masvidal, currently managing
director and head of AEB's Private Bank, were elected Vice Chairmen.
Holmes, 52, became president and chief executive officer of AEB in2000. He joined American Express in 1996 as managing Director and
head of Worldwide Private Banking, leading that unit through a period
of significant expansion.
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Holmes has more than 20 years experience in international banking,
having served in various positions at Wells Fargo Bank and at Bank of
America. From 1993 to 1996 he was an executive vice president and
head of Bank of America's Private Bank. He began his professional
career with the accounting firm of Peat, Marwick & Mitchell in 1974.
He holds a bachelor's degree in Economics from St. Johns College,
Cambridge University in England in 1974 and a master's degree ineconomics, also from St. Johns. He is also a Fellow of the Institute of
Chartered Accountants in England and Wales and co-chairman of the
International Private Banking Council.
William J. Blomquist, a 35-year veteran of American Express Bank, was
appointed managing director and head of the Financial Institutions
Group in 1995. He had been managing director and regional executive in
charge of Europe, Middle East, and Africa, from 1990-1995. Prior to
that, he held wide-ranging senior management roles in Switzerland,
Asia, and the Middle East.
Sergio Masvidal was appointed managing director and Head of the
Global Private Bank, based in Miami, Florida, in 2000. He joined AEB
in 1987 as general manager of American Express Bank International, the
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private banking arm of AEB. In 1992, he became president of AEBI and
in 1996 he became Latin American region head for the Private Bank. He
has more than 30 years of experience in the banking industry.
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BOARD OF DIRECTORS
Daniel F. Akerson
Managing Director, The Carlyle Group
Charlene Barshefsky
Senior International Partner, Wilmer Cutler Pickering Hale and Dorr
LLP
Ursula M. Burns
Senior Corporate Vice President and President of Business Group
Operations, Xerox Corporation
Kenneth I. Chenault
Chairman and Chief Executive Officer, American Express Company
Peter Chernin
President and COO, News Corporation
Vernon E. Jordan Jr.Senior Managing Director, Lazard Freres & Co. LLC
Jan Leschly
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Chairman and Chief Executive Officer, Care Capital LLC
Richard C. Levin
President, Yale University
Richard A. McGinn
Partner, RRE Ventures
Edward D. MillerFormer President and Chief Executive Officer, AXA Financial, Inc.
Frank P. Popoff
Chairman, Chemical Financial Corporation
Steven S Reinemund
Former Chairman and Chief Executive Officer, PepsiCo, Inc.
Robert D. Walter
Chairman and Chief Executive Officer, Cardinal Health, Inc.
Ronald A. Williams
Chairman, Chief Executive Officer and President, Aetna, Inc
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AMERICAN EXPRESS BANK IN INDIA
American Express Bank is a diversified travel and financial services
company. It was founded in the year 1850. American Express Travelers
cell is the world leader.
American Express India was established in 1921 providing high quality
travel and financial services. American Express in India is the largest
company to have wide network of travel locations in the country.
American Express Card division also tops upon other credit card issuer.
American Express Credit Cards in India is of basic two varieties, namely
International Gold Amx Card and International Green Amx Card.
American Express Credit Cards
Criteria for availing American Express Gold and Green Cards are as
follows:
Card TypePublic Ltd -
Income(Rs)
Self Employed -
Income(Rs)
Salaried -
Income(Rs)
International Gold
Amex Card150000 150000 150000
International 72000 72000 72000
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Green Amex Card
American Express in India has also launched Tata Finance American
Express Credit Card with Tata Finance Limited which is globally
accepted on the American Express global merchant network. This card is
both issued and serviced by Tata Finance Limited and carries an
American Express Blue Box logo at the bottom.
The American Express India Card Members enjoy discounts of 3% to
7% on airline tickets, convenience of booking tickets over the phone and
40% discounts on overseas hotels rates.
AREA OF BUSINESS
SMALL BUSINESS
Apply for Cards & Financing
CORPORATIONS
Apply for a Corporate Card
Corporate Card
Business Travel
MERCHANTS
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Accept the card
Manage your Merchant Account
PERSONAL
PERSONAL CARDS
Apply for a Card
Membership Rewards
Benefits
Shopping
Gift Cards
TRAVEL
Flights
Hotels
Cars
Cruises
Vacations
Last Minute Deals
Travelers Cheque Cards
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PRODUCTS & SERVICES
INVESTMENT PRODUCTS
We offer a full range of investment products and the highest standard in
investment management. The Private Bank has the flexibility to choose
world-class sub-advisors and investment managers from the world's
leading asset management and specialty fund managers.
FOREIGN EXCHANGE & TREASURY
Around-the-clock trading of an extensive range of foreign exchange
products, including spot trading, options, derivatives and forward
contracts, with particular expertise in non-G7 currencies. American
Express Bank has trading centers in Hong Kong, Singapore, London and
New York.
CREDIT AVAILABILITY
Secured loans to provide short-term liquidity without disrupting your
long-term investment positions, or to increase your exposures for yield
enhancement. You can leverage your assets in one jurisdiction for use in
another, or your personal assets for your business. Pre-approved loanmargins are in place for a wide range of assets. People can call for the
specific loan-to-value percentage for each product.
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FIDUCIARY SERVICES
Legal structures to protect your assets ensure your wishes are carried out
and secure the future for you and your family. Fiduciary specialists are
available in Europe, Asia and the Americas to advise you on the
structures that will provide protection and accomplish your objectives.
INSURANCE
Insurance can provide liquidity at a critical moment, continuity in your
business should you become disabled, and the maximum number ofchoices for your heirs. Policies are issued by established external
insurance carriers selected on a region-by-region basis.
CHOICE OF JURIDICTION
The Private Bank has offices in all of the major offshore private banking
locations. American Express Private Bank offers access to a wide range
of investment products and services that can help you protect and build
your wealth, regardless of your financial objectives.
SIGNATURE PORTFOLIOS
For individual and institutional investors with $1 million or more,Signature Portfolios offer professional management and a choice of
fixed income, equity or balanced orientation.
US Conservative Fixed Income
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US Moderate Fixed Income
Euro Fixed Income
Global Fixed Income
Global Equities
US Equities
US Mid Cap Equities
US Large Cap Equities
Japanese Equities
European Equities
DISCRETIONARY PORTFOLIOS
These investments are designed for clients who want globally diversified
portfolios with professional management of asset allocation and
underlying products.
http://www10.americanexpress.com/privatebank/pdf/SigUSConservativeFixed.pdfhttp://www10.americanexpress.com/privatebank/pdf/SigUSConservativeFixed.pdfhttp://www10.americanexpress.com/privatebank/pdf/SigUSConservativeFixed.pdfhttp://www10.americanexpress.com/privatebank/pdf/SigUSModerateFixed.pdfhttp://www10.americanexpress.com/privatebank/pdf/SigEurFixed.pdfhttp://www10.americanexpress.com/privatebank/pdf/SigGlobalFixedIncome.pdfhttp://www10.americanexpress.com/privatebank/pdf/Sigglobalequity.pdfhttp://www10.americanexpress.com/privatebank/pdf/SigUSEqu.pdfhttp://www10.americanexpress.com/privatebank/pdf/SigMidCap.pdfhttp://www10.americanexpress.com/privatebank/pdf/SigUSLargeCapEqu.pdfhttp://www10.americanexpress.com/privatebank/pdf/sigjapan.pdfhttp://www10.americanexpress.com/privatebank/pdf/SigEurEqu.pdfhttp://www10.americanexpress.com/privatebank/pdf/SigEurEqu.pdfhttp://www10.americanexpress.com/privatebank/pdf/sigjapan.pdfhttp://www10.americanexpress.com/privatebank/pdf/SigUSLargeCapEqu.pdfhttp://www10.americanexpress.com/privatebank/pdf/SigMidCap.pdfhttp://www10.americanexpress.com/privatebank/pdf/SigUSEqu.pdfhttp://www10.americanexpress.com/privatebank/pdf/Sigglobalequity.pdfhttp://www10.americanexpress.com/privatebank/pdf/SigGlobalFixedIncome.pdfhttp://www10.americanexpress.com/privatebank/pdf/SigEurFixed.pdfhttp://www10.americanexpress.com/privatebank/pdf/SigUSModerateFixed.pdf8/4/2019 Offshore Banking Hsbc
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CASH PLUS
Cash Plus Conservative
Cash Plus Moderate
Cash Plus Moderate Euro
Cash Plus Growth
BALANCED ENHANCED
Enhanced Global Conservative
Enhanced Global Moderate Enhanced European Moderate
Enhanced Global Aggressive
TRADITIONAL
Traditional Global Conservative
Traditional Global Moderate
Traditional European Moderate
Traditional Asian Moderate
http://www10.americanexpress.com/privatebank/pdf/DiscretCshPlsCons.pdfhttp://www10.americanexpress.com/privatebank/pdf/DiscretCshPlsMod.pdfhttp://www10.americanexpress.com/privatebank/pdf/DiscretCshPlsModEuro.pdfhttp://www10.americanexpress.com/privatebank/pdf/DiscretCshPlsGrowth.pdfhttp://www10.americanexpress.com/privatebank/pdf/EnhancedGlobalConservative.pdfhttp://www10.americanexpress.com/privatebank/pdf/EnhancedGlobalModerate.pdfhttp://www10.americanexpress.com/privatebank/pdf/EnhancedEuroModerate.pdfhttp://www10.americanexpress.com/privatebank/pdf/EnhancedGlobalAggressive.pdfhttp://www10.americanexpress.com/privatebank/pdf/TraditionalGlobalConservative.pdfhttp://www10.americanexpress.com/privatebank/pdf/TraditionalGlobalModerate.pdfhttp://www10.americanexpress.com/privatebank/pdf/TraditionalEuropeanModerate.pdfhttp://www10.americanexpress.com/privatebank/pdf/TraditionalAsianModerate.pdfhttp://www10.americanexpress.com/privatebank/pdf/TraditionalAsianModerate.pdfhttp://www10.americanexpress.com/privatebank/pdf/TraditionalEuropeanModerate.pdfhttp://www10.americanexpress.com/privatebank/pdf/TraditionalGlobalModerate.pdfhttp://www10.americanexpress.com/privatebank/pdf/TraditionalGlobalConservative.pdfhttp://www10.americanexpress.com/privatebank/pdf/EnhancedGlobalAggressive.pdfhttp://www10.americanexpress.com/privatebank/pdf/EnhancedEuroModerate.pdfhttp://www10.americanexpress.com/privatebank/pdf/EnhancedGlobalModerate.pdfhttp://www10.americanexpress.com/privatebank/pdf/EnhancedGlobalConservative.pdfhttp://www10.americanexpress.com/privatebank/pdf/DiscretCshPlsGrowth.pdfhttp://www10.americanexpress.com/privatebank/pdf/DiscretCshPlsModEuro.pdfhttp://www10.americanexpress.com/privatebank/pdf/DiscretCshPlsMod.pdfhttp://www10.americanexpress.com/privatebank/pdf/DiscretCshPlsCons.pdf8/4/2019 Offshore Banking Hsbc
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FOCUSED EQUITIES
Focused Global Equities
Focused Asia Ex-Japan Equities
Focused US Equities
Focused Emerging Markets Equities
MUTUAL FUNDS
American Express FundsWorld folio, American Express
Institutional and World Express Funds offer a broad range of mutualfunds designed to meet individual risk tolerance and time horizon
preferences.
PRIVATE BANKER
Your Private Banker can marshal resources on your behalf and craft
solutions to your individual requirements. Wherever the need may arise,
you can have access to the worldwide capabilities and services of the
American Express Company, a global leader in financial services, travel,
and credit and charge cards.
The original card that set the standard for prestige and exclusivity, thePlatinum Card is offered to private banking clients at no annual fee with
qualifying balances. Automatic credit card bill payments can also be
arranged through your Private Banker.
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The original card that set the standard for prestige and exclusivity, the
Platinum Card is offered to private banking clients at no annual fee with
qualifying balances. Automatic credit card bill payments can also be
arranged through your Private Banker.
Travelers Cheques are available in most currencies, including the Euro,
and can be purchased through your Private Banker.
The Private Bank has an extensive global network that has grown and
developed throughout the years to meet the needs of our clients.
American Express Bank currently has 75 offices in 38 countries around
the world.
WEALTH MANAGEMENT
American Express Private Bank offers a range of wealth management
services designed to meet your unique needs.
Protecting Your Wealth
Building Your Wealth
Providing for Future Generations
DEPOSITSTraditional and innovative deposit and deposit-alternative products can
help you meet your needs for liquidity and capital. American Express
Premium Deposits, available in most locations in U.S. dollars and Euro,
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offer an alternative to bank deposits and are particularly suited to
investors who want both security and a competitive rate. These non-bank
deposits are available in terms of 1, 2, 3, 6 or 12 months with
competitive rates relative to the London Interbank Rate, fixed for the
term of the deposit.
Our investment management solutions are designed to grow your
assets while you achieve your unique financial objectives.
Maximum flexibility and access to nearly all the major worldwide
asset classes characterize the Private Bank's family of mutual
funds.
Portfolio management by investment professionals who are among
the best in their industry.
Discretionary portfolios for investors who want globally
diversified portfolios and prefer professional management of their
asset allocation and fund selection.
Alternative investment solutions for sophisticated investors.
Ideas and information that synthesize research from within and
outside of American Express to assist you in making your
investment choices.
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OTHER SERVICES
Your substantial assets require complex estate planning to ensure that
your wealth is protected and managed for your benefit and for the
benefit of future generations.
A variety of structures to choose from, including trusts and private
investment companies, depending on your individual circumstances.
Expert advice to meet your needs for estate planning, tax minimization,
confidentiality, and management continuity and centralization.
A choice of jurisdictions for the most convenient and advantageous
location.
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BIBLIOGRAPHY
Company Annual Report
International Financial Management, by Stonehill and EittemanThe World Bank TreasuryThe World Bank Group
WEB SITES
www.americanexpres.com
www.google.com
http://en.wikipedia.org/wiki/Banker
http://answers.yahoo.com,http://www.hsbc.co.in/www.worldbank.orgwww.ibrd.org
http://www.americanexpres.com/http://www.google.com/http://www.google.com/http://www.americanexpres.com/