Globalising international banking

11 March 2002

Over the last generation, internationally active banks have shifted from international to global banking. Some banks, rather than taking deposits in one jurisdiction and lending in another, have pursued the strategy of taking deposits and offering consumer loans, mortgages and corporate loans within a variety of national markets through a local presence. Other banks have pursued a capital markets strategy, seeking to fund their portfolios of local securities locally as well. Whether adopting a global consumer or global wholesale model, banks are increasingly looking to serve customers through a local presence funded locally. The ambition to build a global (or multinational) bank so defined differs from that to build an international bank, defined here as a bank that takes deposits in one country and makes loans in another.