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International Banking Regulations

By Alex Burke, eHow Contributor

When you hear the words "banking regulation" most tend to think of one source, aparticular organization or committee that handles issues regarding banking regulations

within a particular country. When the topic becomes "international banking regulation,"

though, things change. International implies more than one country's involvement. Isinternational banking regulation as straight forward and simple to assess as it sounds?

What levels of oversight are used? Who is in charge?

What Is A Central Bank?International banking regulation begins inside each country or nation. A country's

international banking regulation is filtered by its "central bank" also called a reserve bank

or monetary authority. Every country has one. A central bank is not a bank that just

anyone uses. Its specific role is to maintain stability of its own currency and the moneysupply for that country.

U.S. International Banking Regulation

U.S. banking is regulated and monitored by the Federal Reserve System, often referred to

as "the Fed." The Federal Reserve System is a central bank and not only monitors thebanking industry inside the U.S., but by implementing monetary policy, controlling the

money supply, and managing the country's foreign exchange and gold reserve, it is alsoregulates international banking. It further controls the monetary system by deciding what

form of currency is used, whether or not other countries currencies are used and how all

currencies are used within its banking system.Bank For International Settlements

The Bank for International Settlements (BIS) is the international organization for central

banks. Its purpose is to serve as a bank for central banks and to cultivate international

financial and monetary cooperation. Because monetary policy is always decided upon byeach nation, there can be differences in policy. BIS has two areas of interest: capital

adequacy (preventing overvaluing of assets) and making reserve requirementstransparent.Basel Committee on Banking Supervision

BIS has a number of committees to address specifics about international banking. These

committees look at payment and settlement systems, markets, central bank statistics,banking supervision, and global financial systems. One of the better known committees is

the Basel Committee on Banking Supervision which is charged with strengthening

banking supervisory systems throughout the world. This committee works to strengthen

policy development and accounting and auditing standards.What Else Affects International Banking?

War, disagreements, import and export or trade policies, and political standoffs are a few

of the situations that may affect international banking One of the more well-knownpolicies affecting international banking regulations is the no trade policy the U.S. has

established regarding Cuba. Since trade with Cuba is prohibited in the U.S., so is Cuban

currency. The Cuban peso has no value in the U.S., which means that it is not accepted atany bank.