Abstract
The Federal Reserve Board permitted banking offices located in the United States to establish International Banking Facilities (IBFs) beginning in December 1981. The purpose was to allow these banking offices to conduct a deposit and loan business with foreign residents, including foreign banks, without being subject to reserve requirements or to the interest rate ceilings then in effect.1 IBFs are also exempt from the insurance coverage and assessments imposed by the Federal Deposit Insurance Corporation. In addition, a number of states have encouraged banking institutions to establish IBFs by granting favorable tax treatment under state or local law for IBF operations. As a result, banking offices located in the United States can, through their IBFs, conduct transactions with foreign residents in a regulatory environment broadly similar to that of the Eurocurrency market without having to use an offshore facility.
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© 1989 Kluwer Academic Publishers
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Key, S.J., Terrell, H.S. (1989). The Development of International Banking Facilities. In: Park, Y.S., Essayyad, M. (eds) International Banking and Financial Centers. Springer, Dordrecht. https://doi.org/10.1007/978-94-009-2504-5_13
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DOI: https://doi.org/10.1007/978-94-009-2504-5_13
Publisher Name: Springer, Dordrecht
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