international banking..

1. Lecture 4 – International Banking
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2. Commercial Banks
Companies that transact the business of Banking in Pak
Banking Companies Ordinance, 1962. Sec 5 (b),
“Banking means the accepting, for the purpose of
lending or investment, of deposits of money from public,
repayable on demand or otherwise, and withdrawable by
cheques, drafts, order or otherwise.”
Scheduled vs Non- scheduled Banks
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3. Scheduled vs Non- scheduled Banks
The Banks which are registered in the list of SBP are
known as scheduled banks.
They are bound to perform Banking services according
to policies and instructions of SBP.
they are bound to share every information
Accounts to be audited by SBP.
Appointment at senior level to be made by / consent of
SBP.
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5. Under-writing
Underwriting refers to the process that a large financial
service provider (bank, insurer, investment house) uses to
assess the eligibility of a customer to receive their products
(equity capital, insurance, mortgage, or credit). The name
derives from the Lloyd's of London insurance market.
Financial bankers, who would accept some of the risk on a
given venture (historically a sea voyage with associated risks
of shipwreck) in exchange for a premium, would literally
write their names under the risk information that was written
on a Lloyd's slip created for this purpose.
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6. Banking Services
Mobilizing Money – Savings
Agency services and issuing guarantees
Lending and Investment
General Utility Services
Underwriting of Loans (Gov & Public Bodies)
International Trade Financing
Hajj Operations
Tasks assigned by SBP
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7. Bank Guarantee
A guarantee from a lending institution ensuring that
the liabilities of a debtor will be met. In other words,
if the debtor fails to settle a debt, the bank will cover
it.
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8. Difference between a bank
guarantee and a letter of credit
A letter of credit is an obligation taken on by a bank
to make a payment once certain criteria are met.
Once these terms are completed and confirmed, the
bank will transfer the funds. This ensures the
payment will be made as long as the services are
performed.
A bank guarantee, like a line of credit, guarantees a
sum of money to a beneficiary. Unlike a line of credit,
the sum is only paid if the opposing party does not
fulfill the stipulated obligations under the contract.
This can be used to essentially insure a buyer or seller
from loss or damage due to non performance by the05/10/15 8

9. Specialized Credit Institutions
Pakistan Industrial Credit & Investment Corporation
(PICIC)
Industrial Development Bank Of Pakistan (IDBP)
Agricultural Development Bank of Pakistan (ADBP)
Investment Corporation of Pakistan (ICP)
Small and Medium Enterprise Development Authority
(SMEDA)
House Building Finance Corporation (HBFC)
Equity Participation Fund
SME Bank Ltd
National Investment Trust (NIT)
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11. Specialized Credit Institutions – International
International Monitory Fund
International Bank for Reconstruction & Development
International Finance Corporation (IFC) – World Bank
International Development Association (IDA)
Multilateral Investment Guarantee Agency (MIGA)
The Islamic Development Bank (IDB)
Asian Development Bank
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12. Bretton Woods Institutions
The Bretton Woods Institutions are the World Bank,
and the International Monetary Fund (IMF). They
were set up at a meeting of 43 countries in Bretton
Woods. Their aims were to help rebuild the shattered
post World War 2 economy and to promote
international economic cooperation. The original
Bretton Woods agreement also included plans for an
International Trade Organisation (ITO) but these lay
dormant until the World Trade Organisation (WTO)
was created in the early 1990s.
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