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Chinese bank's potential to set up a new market in UK - Essay Example
Pages 16 (4016 words)
Chinese bank’s potential to set up a new market in UK Abstract Financial services sector has undergone tremendous changes over the past few decades. In order to be competitive in the age of globalization, many financial institutions tend to cultivate strategic partnership, mergers, acquisitions, and diversification…
This paper will perform a feasibility study to evaluate a Chinese bank’s potential to set up a new market outside the country. Introduction Bank is one of the most common forms of financial services in an economy. The major function of a bank is to receive deposits from people and to lend money to potential customers. In every country, there is a central bank to manage the state’s currency rate, money supply, and interest rates. Economists unanimously propose that strength of the banking sector is a direct determinant of a country’s economic feasibility and sustainability. In order to attain greater level of operational efficiency and to sustain their operations, banks need to attract huge amounts of deposits. Although lending is a potential way to improve the profitability of banking operations, careless and excess lending would challenge the long term sustainability of banks. Thoughtless mortgage lending led to a series of bank failures in the United States over the last decade. Since then, banks all over the world have been giving increased focus to the repayability of loans granted. Many well established banks consider international operation as an effective strategy to spread risk elements and to achieve greater future certainty. ...
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