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International Banking Concepts and examples World’s Biggest Banks (assets in billion of dollars:1998) 1 Bank of Tokyo-Mitsubishi, Japan, 85,372 2 HSBC.

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Presentation on theme: "International Banking Concepts and examples World’s Biggest Banks (assets in billion of dollars:1998) 1 Bank of Tokyo-Mitsubishi, Japan, 85,372 2 HSBC."— Presentation transcript:

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2 International Banking Concepts and examples

3 World’s Biggest Banks (assets in billion of dollars:1998) 1 Bank of Tokyo-Mitsubishi, Japan, 85,372 2 HSBC Holdings, UK, 76,357 3 Lloyds TSB Group, UK, 54,453 4 Citicorp, US, 53,822 5 Sumitomo Bank, Japan, 41,944 6 BankAmerica, US, 41,344 7 Dai-Ichi Kangyo Bank, Japan, 41,131 8 Chase Manhattan, US, 40,363 9 Fuji Bank, Japan, 38, Sanwa Bank, Japan, 37, NationsBank, US 34, Barclays, UK 32, Industrial Bank of Japan 30, Deutsche Bank Germany 29, Union Bank of Switzerland 25, Wells Fargo Bank, US 25, ABN Amro Holding, Netherlands 25, First Union, US 23, Hang Seng Bank, Hong Kong 23, National Westminster Bank, UK 22, Credit Suisse Group, Switzerland 22, Abbey National, UK 22, Sakura Bank,Japan 21, National Australia Bank 20, Norwest, US 20, Royal Bank of Canada 13,430

4 World's financial centers: London Tokyo New York Paris, Frankfurt, Zurich, Amsterdam, etc.

5 Foreign Exchange Trading Income of Selected Banks ( in millions of US$ ) Company Bank of New YorkNANA Chase Manhattan Citicorp684531,4861,6281,569 Credit Suisse First BostonNANA Deutsche BankNANA1, Mellon Financial Corp Morgan (J.P.) & Co Republic National Bank State Street Bank

6 Reasons for international banking: International trade and investment Low marginal costs Arbitrage regulations Defensive strategies Limited domestic market Risk reduction

7 A Primer on Import/Export Payments ImporterExporter 1. Exporter ships the goods 2. Importer pays after receiving the goods Importer’s preference

8 A Primer on Import/Export Payments ImporterExporter 2. Exporter ships the goods after payment 1. Importer pays the goods Exporter’s preference

9 The Bank as an Export/Import Intermediary ImporterExporterBank 1. Importer obtains bank’s permission to pay on importer’s behalf 2. Bank promises exporter to pay on behalf of importer 3. Exporter ships to the bank 4. Bank pays exporter 5. Bank releases merchandise to importer 6. Importer pays bank

10 A Typical Trade Transaction ImporterExporter Bank I Bank X 1. Importer orders goods 2. Exporter agrees to fill order 3. Importer arranges L/C with bank I 4. Bank I sends L/C to bank X 6.. Exporter ships goods 5. Bank X advises exporter of L/C 7. Exporter presents shipping documents to bank X 8. Bank X presents shipping documents to bank I 9. Bank I accepts documents and promises to pay within 60 days Public investor 10. Bank X sells acceptance documents 11. Payment 12. Payment 13. Investor presents documents and gets paid

11 Types of international banking offices: Types of international banking offices: Correspondent banks Representative office Foreign branch Subsidiaries Affiliates Offshore banking centers

12 What is offshore banking? Excepts from and offshore banking ad: IF you are wondering if Offshore Banks are Safe and Secure, you need not worry. The jurisdictions we deal with have been in the banking business long before the U.S.A. even became a country. Offshore jurisdictions do not recognize the U.S. legal system and therefore judgments lawsuits and collections are not a concern. These jurisdictions are also tax-free. Total anonymity with complete and secure access. No U.S. Social Security or Tax I.D. number needed.

13 ….more ads: Your Freedom Is Being Threatened! You've seen the headlines: Over and over again, politicians and other bureaucrats from all over the world are clearly demonstrating what they really have on their minds. Not freedom, not prosperity, but a worldwide police state of complacent slaves, controlled by a small but powerful elite. It Starts With Education And Money... Who controls the world? Those who control education and money. Unfortunately, less and less people seem to realize what is really going on. Even if some of them wake up from time to time, it is all too easy to return to that state best described as indifferent daze. Free Your Mind! No matter who or where you are, you too can adopt that "offshore" state of mind and the powerful knowledge... that you aren't owned by anyone other than yourself, that you are free to do whatever you like as long as you don't violate the rights of others, that you owe it to yourself to develop and live up to your very highest potential. Would You Benefit From Waking Up and Breaking Free? Etc, etc, etc…..

14 Offshore investing spawned an entire culture The "BIBLE" on living a bureaucratic free life contains the following best selling publications : P.T. # 1 - (Perpetual Traveler, Previous Taxpayer, Possibility Thinker, Prepared Thoroughly...) The Passport Report - The definitive guide to acquiring one or several Second Passports! Portable Trades and Occupations Report - The PT's Guide to Tax-Free Income Opportunities! The Invisible Investor - Learn the Insiders Secrets to Acquiring Wealth Offshore!

15 Offshore banks: operate outside the jurisdiction of most industrialized countries are subject to very few regulations are located in tax havens

16 Tax havens countries

17 Tax avoidance: Exemplification

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19 Tax avoidance: Benefits Lincoln belge gets a tax deduction Old Abe gets a tax free interest income


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