Currency risk and country risk in international banking
Article Abstract:
Loans to foreign customers, floated by U.S. banks in dollar denominations, create currency and foreign country risks for the banks. By identifying the sources of such risks, the research shows that currency risks relate to inflation (both domestic and international) and the deviations in purchasing power parity created by inflation subsequent to the granting of the foreign loan. Country risk is related to the foreign nation's economy, its trade regulations and economic policies. The discussion of this analysis of risks associated with U.S. bank loans to foreign countries focuses on three main areas of the analysis: international capital market equilibrium, exchange rates' effect on currency prices, and risks experienced by the borrowing country.
Publication Name: Journal of Finance
Subject: Business
ISSN: 0022-1082
Year: 1985
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Taxation of Interest Income, Deregulation and the Banking Industry
Article Abstract:
A model is developed of the banking industry to compare a ceiling on the payment of explicit interest on bank deposits and the effect of taxes on below cost services. Depositors will choose a mix of both depending on the tax rate on interest income. Under constraint, depositors respond to return on bank portfolios.
Publication Name: Journal of Finance
Subject: Business
ISSN: 0022-1082
Year: 1983
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Currency orders and exchange rate dynamics: an explanation for the predictive success of technical analysis
Article Abstract:
The article examines clustering in take-profit orders and currency stop-loss orders; findings are used to explain trend movements at resistance and support levels Take-profit orders can cause trends to reverse course; stop-loss orders can speed up trends after rates go beyond resistance and support levels.
Publication Name: Journal of Finance
Subject: Business
ISSN: 0022-1082
Year: 2003
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