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James C. Baker - The Bank for International Settlements: Evolution and Evaluation

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In a world of increasing cross-border financial transactions, The Bank for International Settlements stands out as the oldest existing international financial institution and among the most controversial. For many it is a mystery: What does it actually do? For others it poses an ethical dilemma: What DID it do to aid the Nazis during World War II? Baker examines the history, administration, evolution, and operations of this reclusive institution. He discusses the work of its permanent committees, such as the Basle Concordats of 1975 and 1983 and the Basle Capital Accords of 1988 and 2001. Among other products and services he notes The BISs studies of the use of derivatives by banks, its analysis of payment and settlement systems worldwide, and its supervision of the insurance and investment banking businesses. Then, in a cool and balanced appraisal, he looks at the Banks operations during World War II, its relationship with the Nazis in their gold and foreign exchange transactions. Throughout, he underlines the importance of The BIS and its value in maintaining stability of the international monetary system. The result is a major academic study, a work of special interest to scholars, teachers, and students, and an important, readable, engrossing account for finance and investment professionals as well.

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title The Bank for International Settlements Evolution and Evaluation - photo 1
title:The Bank for International Settlements : Evolution and Evaluation
author:Baker, James Calvin.
publisher:Greenwood Publishing Group
isbn10 | asin:1567205186
print isbn13:9781567205183
ebook isbn13:9780313006807
language:English
subjectBank for International Settlements, International finance, Banks and banking, Central.
publication date:2002
lcc:HG3881.B253 2002eb
ddc:332.1855
subject:Bank for International Settlements, International finance, Banks and banking, Central.

Page i

The Bank for International Settlements

Page ii

This page intentionally left blank.

Page iii

The Bank for International Settlements

Evolution and Evaluation

JAMES C. BAKER

The Bank for International Settlements Evolution and Evaluation - image 2

QUORUM BOOKS

Westport, Connecticut London

Page iv

Library of Congress Cataloging-in-Publication Data

Baker, James Calvin, 1935
The Bank for International Settlements : evolution and
evaluation / James C. Baker.
p. cm.
Includes bibliographical references and index.
ISBN 1567205186 (alk. paper)
1. Bank for International Settlements. 2. International
finance. 3. Banks and banking, Central. I. Title.
HG3881.B253 2002
332.1855dc21 2001049184

British Library Cataloguing in Publication Data is available.

Copyright 2002 by James C. Baker

All rights reserved. No portion of this book may be
reproduced, by any process or technique, without the
express written consent of the publisher.

Library of Congress Catalog Card Number: 2001049184

ISBN: 1-56720-518-6

First published in 2002

Quorum Books, 88 Post Road West, Westport, CT 06881

An imprint of Greenwood Publishing Group, Inc.
www.quorumbooks.com

Printed in the United States of America

Picture 3

The paper used in this book complies with the
Permanent Paper Standard issued by the National
Information Standards Organization (Z39.481984).

10 9 8 7 6 5 4 3 2 1

Page v

To Lee C. Nehrt

who introduced me to a world of international financial institutions

Page vi

This page intentionally left blank.

Page vii

Contents

Illustrations

ix

Preface

xi

Acknowledgments

xiii

Acronyms

xv

Chapter 1

Introduction to the Bank for International Settlements

Chapter 2

Changes in BIS Organization, Administration, and Financing

Chapter 3

BIS Committees and Research

Chapter 4

The BIS and Bank Supervision

Chapter 5

The Basle Accord on Capital Adequacy

Chapter 6

The Bank for International Settlements and Derivatives

Chapter 7

Payment and Settlement Systems and the Bank for International Settlements

Page viii

Chapter 8

The Bank for International Settlements and Its Relations with Central Banks

Chapter 9

The Bank for International Settlements and Other International Financial Institutions

Chapter 10

The Bank for International Settlements and Insurance Supervisors

Chapter 11

Research and Miscellaneous Activities

Chapter 12

Nazi Gold, the Bank for International Settlements, and Central Banks

Chapter 13

Evaluation and Conclusions

Appendix I

Balance Sheet: Bank for InternationalSettlements

Appendix II

Profit and Loss Account: Bank for International Settlements

Selected Bibliography

Index

Page ix

Illustrations
FIGURES

2.1

Member Central Banks of the BIS

4.1

Basle Concordat of 1975

4.2

Basle Concordat of 1983

6.1

BIS Development of Derivatives, Regulations, and Disclosures

10.1

Issues of Insurance Regulation

10.2

Exemptions from Insurance Company Regulatory Reporting Requirements

10.3

Insurance Supervision Standards of the IAIS

12.1

Asset-by-Asset Activities Organizing Seminar, Washington Conference on Holocaust-Era Assets

TABLES

12.1

Gold Transactions of the Reichsbank

Page x

12.2

Gold Transfers of the Reichsbank to the Swiss National Bank

12.3

Gold Sales and Purchases of the Swiss National Bank

12.4

Gold Transactions of the Reichsbank via the Swiss National Bank

12.5

Gold Shipped to Swiss Commercial Banks by the German Reichsbank

Page xi

Preface

This monograph is a study of the Bank for International Settlements (BIS) and its evolution, administration, operations, and evaluation. The BIS is the oldest international financial institution, having been established in 1930. It survived the conclusion of its major initial objective, a global economic depression, a world war, and an everchanging international monetary and financial system in which major banks have failed, banks in general have been inadequately capitalized, financial derivative instruments have been misused, currency crises occurred in Asia, Europe, Mexico, and Russia, the U.S. dollar was devalued twice within two years, and charges of laundering gold for the Nazis in World War II have been made against the BIS.

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