Question 2

(a) International banks play a major role in international trade by assisting multi-national companies to reduce the risk of foreign trade. Discuss the methods used by international banks in the trade process by focussing on the main trade financing instruments that are provided by the banks. (30 marks)

(b) Discuss the impact of the Financial Services Modernization Act of 1999 on commercial banking operations. Describe the how the act had changed the competitive environment of financial institutions. (20 marks)