Question

The increase in the number of multinational corporations has been eased by the availability of international banking services. These services facilitate the banking needs of the subsidiaries of the multinational firms. Describe the international banking services that are provided by commercial banks providing the link to internet resources used. Commerce Bank (2015) offers international services such as letters of credit, foreign exchange, purchase of foreign currency, foreign currency wire transfers, and other services. The services provided by Commerce Bank are very limited compared to other commercial banks. This can been seen by the posts in the discussion regarding US Bank.

Answer 1

Commercial banks offer many facilities such as currency exchange, issuing letter of credit, raising funds etc to companies and their subsidiary and hence in this way it can support companies to venture in foreign markets.

Additionally banks also are able to do project due diligence, underwrite issuance of equity or private placement of bonds and securitize certain financial securitise issued by the company. Thus commercial banks help in financial intermediation and fund raising as well as creating credit line to provide debt and working capital loans for the company.

Source: Bank of International Settlement - www.bis.org