Contemporary Tendencies Of Banking Globalization

Banking globalization is a specific form of financial globalization. It is manifested through the following: performing global banking operations, concentration of banking capital, expanding activity of transnational banks and emergence of global banks, standardization of national banking systems, emergence of single banking model, substantially change nature and forms of competition in financial markets, reorientation of banking business from traditional to innovative, development of outsourcing of certain functions and operations of global banks. Banking globalization has a number of positive aspects: increasing market efficiency and expanding competitive banking environment; formation of a universal banking culture; fundamental changing of global banking system functioning and altering the quality of banking activity. At the same time, banking globalization has also negative aspects: development of offshore banking has contributed to creation of an international infrastructure to serve shadowy financial flows, to launder money and to carry out the hostile acquisitions of banks. Banking globalization has also led to unjustified stimulation of global lending and the international distribution of risks, thus becoming a financial instability factor. The conducted study allowed to outline the essence of banking globalization and main channels of influence on banking system of Republic of Moldova: banking regulation, participation in the capital of domestic banks, diffusion of innovations in banking products market and participation in international financial flows. This impact, on the one hand, has beneficial effects on the implementation of modern banking technologies. However, on the other hand, it generates a complex of problems. The research has shown the contribution of banking globalization to the emergence of recent banking crisis in Republic of Moldova. All this requires reviewing prospects of domestic banking system developing and banking regulatory process continuously improving.