International banking business - International business

International banking business

International banking business plays a special role in the world economy. Formation of the international banking business is a long historical process of transnationalization and internationalization. The activity of banks since their inception is aimed at financing other sectors of the economy related to production and trade. With the development of international trade, banks faced the challenge of developing foreign markets and conducting international operations in various currencies. Banks followed their clients, whose business developed and increasingly acquired an international character.

The result of globalization of the world economy and banking business was the formation of transnational banks , which are financial institutions operating in different parts of the world and offering financial services of a wide range. The activities of transnational banks are characterized by a global nature and a significant proportion of international transactions. Currently, clients of multinational banks are both large companies and small businesses and individuals.

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The HSBC group has a long history. The name of the group comes from The Honkong and Shanghai Banking Corporation Limited, a small bank that was established to finance international trade between Asia and the West and began operations in Hong Kong in 1865.

Now the group HSBC is one of the largest organizations in the world providing banking and financial services. The headquarters of the group is in London. Through an international network of more than 7,200 offices located in more than 85 countries and territories in Europe, the Asia-Pacific region, the Americas, the Middle East and Africa, HSBC provides a wide range of financial services more than 85 million private customers and nearly 3.6 million commercial customers. The group HSBC employs about 300 thousand employees who speak more than 100 languages. As of December 31, 2012, the group's assets amounted to more than $ 2,500 billion.

Thanks to the global network of the HSBC group , units can use banking products and services developed in different markets and adapt them to meet the needs of local customers, which allows them to meet their most diverse financial needs.

Banks play a vital role in the financing of international companies through the provision of loans for current activities (replenishment of working capital), financing of export-import transactions, arranging the placement of securities of companies in international markets.

Large transnational banks are the core of the international banking system. At the same time, relatively small banks are involved in international banking operations in the process of servicing their clients - companies whose activities are related to international business. In this regard, several forms of international banking can be identified.

Not every bank can immediately afford to develop its activities abroad. For most banks, the first step in the development of international activity is the establishment of correspondent relations with foreign banks. Correspondent relations - contractual relations between credit institutions on the implementation of payments and payments by one of them on behalf of and at the expense of another. Small banks can establish correspondent relations with large banks inside the country (national banks), which have a wide network of correspondent banks abroad. Establishment of correspondent relations is an indispensable condition for international settlements. Correspondent banks play an extremely important role, especially in those countries in which the bank can not be represented directly for various reasons.

As the scope of activity and internationalization of business grows, banks expand their presence in the international banking business, creating a network of units abroad. There are several types of bank subdivisions. A subdivision registered as a company independent of the parent bank is a subsidiary bank ( subsidiary bank ), an entity that is not registered as a separate independent company has the status of branch bank ( branch), the foreign branch of the bank, whose co-owners are both a foreign bank and its partner (national or foreign) is affiliated bank ( affiliated bank ).

Transnational banks provide not only services in terms of providing international business to clients, providing settlements for foreign trade transactions, but also investment services, being the main intermediaries in the international capital market. At the same time, the financial crisis of recent years has had a significant impact on the landscape of the international banking business. Many of the world's largest banks began to reduce the volume of foreign operations, while among the world's leading banks there were new players.

The British magazine The Banker annually publishes ranking (from to rank - to rank) 1000 largest banks in the world. When compiling the list, experts are guided by the indicator Tier 1 Capital - tier 1 capital, which includes authorized capital and retained earnings. As noted by the editor-in-chief of The Banker Philip Alexander, the 2012 ranking reflected all the key trends of the global economy: while European banks calculate the losses from the debt crisis in the eurozone, China becomes the driver of emerging markets and marks the "new era" in the banking industry. It is no accident that in the list of the world's largest banks there were a lot of credit organizations representing the People's Republic of China (Tables 15.6 and 15.7).

Table 15.6

Top 10 largest banks in the world but the volume of capital in 2011

Bank name

Country

Capital, billions of dollars.

Return on equity,%

Bank of America

US

159,232

-0.14

JP Morgan Chase & amp; Co

US

150,384

17.79

Industrial and Commercial Bank of China

China

140,028

30.86

HSBC Holdings

Great Britain

139.59

15.67

Citigroup

US

131,874

11.11

China Construction Bank Corporation

China

119,135

29.19

Mitsubishi UFJ Financial Group

Japan

117,018

15.06

Well Fargo & amp; Co

US

113,952

20.46

Bank of China

China

111,173

24.08

Agricultural Bank of China

China

96,413

26.04

Table 15.7

Top 10 largest banks in the world by assets in 2012

Bank

Country

Assets, billion dollars

Deutsche Bank

Germany

2,800

HSBC

United Kingdom

2.556

BNP Paribas

France

2.543

Industrial and Commercial Bank of China

China

2.456

Mitsubishi UFJ Financial Group

Japan

2,477

Credit Agricole

France

2,432

Barclays Group

United Kingdom

2,417

Royal Bank of Scotland

United Kingdom

2,330

JP Morgan Chase

US

2.266

Bank of America

US

2,129

Note: Included in the rating of the 10 largest banks by the amount of capital according to the results of 2011, China Construction Bank Corporation, Bank of China, Agricultural Bank of China in the rating by the size of assets for 2012 occupied 11 th, 13th and 15th places.

The activities of international banks and their strategy for forming relationships with customers are affected not only by the economic situation, but also by the development of information technology. The world's largest banks are changing the format of work with customers, taking into account technological innovations. The technologies of Internet banking have become widespread, mobile banking is developing. The introduction of forms of customer service using modern technologies is beneficial not only to customers (speed, getting service anywhere in the world, the ability to constantly monitor their accounts, etc.), but also the credit organization itself (reducing operating costs, maintenance costs and staff training , rent of premises, increase in the number of attracted customers, etc.). Currently, most banks use the click and blick strategy, which implies the combination of online banking and the provision of banking services through traditional sales channels - in bank branches.

Despite the rapid development of online banking, traditional sales channels do not go away in the past for many reasons. First, the degree of prevalence of online banking is related to the availability of the population to the technical possibilities of using these services, and secondly, the client needs to go through the initial stage of "addiction" to carry out transactions independently through the Internet without the assistance of a bank employee, and thirdly, in the minds of people there are concerns about the degree of security of transactions when using Internet banking. And if all these difficulties are gradually overcome, including by using bonus programs, explaining to customers the possibilities of Internet banking and its security, the specificity of banking services is such that not all services can be provided virtually, and even customers themselves in carrying out complex financial, investment operations need personal consultation with a bank specialist.

At present, we can talk not only about Internet banking as an alternative channel for selling traditional services, but also about using the Internet opportunities to implement the marketing strategies of banks, i.e. Banking Internet Marketing . Undoubtedly, banks have their own sites on the Internet. The content, design, usability of the site significantly affects the perception of the bank, the formation of its image and the memorability of the brand. Together with the heme, banks are active in social networks, such as Facebook, Twitter , etc., place their videos on Youtube. The use of social media (SM) , which are social networks, become one of the most relevant companies and financial institutions in marketing policy.

Aite Group , in conjunction with the European Financial Marketing Association - EFMA between August and October 2010. a survey of 166 representatives of the top management of American and European financial institutions. The main objective of the study was to identify the strategies and tactics used by banks and other lending institutions with regard to social networks or planned to be implemented in the future.

According to the experts of the Aite Group and EFMA, financial institutions are at the earliest stages of forming their competence in the SM sector. About 60% of respondents reported that their banks in working with social networks can be considered "newbies" or beginners & quot ;. There is no particular difference between American and European financial institutions in this respect.

According to the survey, the main goals that financial institutions seek in the course of interaction with SM are attracting new customers, strengthening customer loyalty and their trust in the brand, as well as developing and deepening relations with consumers. In the future, it is possible that banks will significantly increase their investment in SMs, and these funds will be used mainly to save customers, generate additional revenues and reduce costs for marketing activities.

Social networks can be used to educate customers about the use of banking products and technologies. So, specialists Wells Fargo on mobile banking conducted in Twitter several discussions on the use of mobile devices. Specialists answered consumer questions related to the specifics of mobile banking (for example, how to use a mobile device to monitor the balance of the current account during purchases). A web-seminar on security issues was also organized. The management of the bank believes that due to such actions it is possible to better know the opinion of customers about the quality of the service, and also to use their complaints and suggestions for eliminating the shortcomings.

The information received in social networks can be useful for accounting when developing new products. Especially it concerns products for youth. So, the information in social networks helped Р [ Marier Bank in the creation of financial products for customers 18-25 years old. A significant role in this was played by young employees of the bank, who communicated in social networks and asked questions on their behalf, so they collected valuable information, which were then taken into account when creating a financial product for young people First Access Checking.

Using social networking resources can be very useful for increasing loyalty to the brand of the bank. For example, former marketing director Facebook Randy Zuckerberg considers the most successful humanistic initiatives of banks - holding charity events. The project Chase Community Giving is especially indicative in this respect. The Bank JP Morgan Chase used the opportunities of the social network to inform the general public about its charitable activities, which was positively responded by almost 3 million network users. At the same time, users could join the shares, giving bankers advice on possible directions of investment.

As these examples show, financial institutions can significantly increase their loyalty to their brand by quickly responding to the problems and desires that arise from users, as well as involving them in various charitable initiatives. According to the study Social Media for Banking 2012, in the rating of the most active banks on social sites was Citibank, gaining 47 points out of 50 possible. Slightly inferior to him, gaining 44 points, the Spanish bank BBVA and the National Bank of Australia ( ΝAΒ ), followed by the French Credit Agricole and German Deutsche Bank (43 points).

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