GLOBAL FINANCIAL

MARKETS &
INSTITUTIONS
• Global Banking and Financial Institutions
• International Bond Markets
• International Equity Markets
• Interest Rates and Currency Swaps
• International Portfolio Investment
International Financial Institutions (IFI)
• It is a financial institution that has been established (or chartered) by more than
one country, and hence is subject to international law.
• The most prominent IFIs are creations of multiple nations, although some bilateral
financial institutions (created by two countries) exist and are technically IFIs.

Characterized by AAA-credit ratings and a broad membership of borrowing and

donor countries, each of these institutions operates independently. All however,
share the following goals and objectives:
 to reduce global poverty and improve people's living conditions and standards;
 to support sustainable economic, social and institutional development; and
 to promote regional cooperation and integration.
Types of International Financial Institutions
Multilateral Development Banks - A multilateral development bank (MDB) is an institution, created by a group
of countries, that provides financing and professional advice to enhance development.
There are two main forms of multilateral development banks
- The first, which includes the largest and best-known institutions, makes loans and grants. ( World
Bank, Inter-American Development Bank)
- The second type of multilateral development bank is formed by governments of low-income
countries that can then borrow collectively via the MDB in order to secure more favorable rates.
(Carribean Development Bank)

Major Multilateral Development Banks

The following is a list of the major multilateral development banks, ranked by total assets as of Dec. 31, 2018, except for the
World Bank Group, which reflects Dec. 31, 2019 assets (exchange rates are as of April 15, 2020):
• European Investment Bank: €555.8 billion ($606.5 billion)
• International Bank for Reconstruction and Development, World Bank Group: $283 billion
• Asian Development Bank: $191.9 billion
• International Development Association, World Bank Group: $188.5 billion
• Inter-American Development Bank: $129.5 billion
• European Bank for Reconstruction and Development: €61.9 billion ($67.7 billion)
• African Development Bank: 33.8 billion UA
• Asian Infrastructure Investment Bank: $19.6 billion
• Islamic Development Bank: 22 billion Islamic dinars ($18.5 billion)
• Central American Bank for Economic Integration: $10.9 billion
• Bretton Woods Institutions - The best-known IFIs were established
after World War II to assist in the reconstruction of Europe and
provide mechanisms for 33 international cooperation in managing the
global financial system.
The Bretton Woods Institutions—the IMF and World Bank—have an
important role to play in making globalization work better.
- World Bank concentrates on long-term investment projects,
institution-building, and on social, environmental, and poverty
issues.
- The IMF focuses on the functioning of the international monetary
system, and on promoting sound macroeconomic policies as a
precondition for sustained economic growth.
Regional Development Banks - The regional development banks consist
of several regional institutions that have functions similar to the World
Bank group's activities, but with particular focus on a specific region.
It is established to provide investment capital for startup businesses and
businesses in low or middle-income countries.

Institutions are summed up to RDB

- African Development Bank (AfDB)
- Asian Development Bank (ADB)
- European Bank for Reconstruction and Development (EBRD) and
- Inter-American Development Bank (IDB).
- Central American Bank for Economic Integration
Bilateral Development Banks and and Development Company (DEG).
Agencies - A bilateral development bank
is a financial institution set up by one The main bilateral DFIs include:
individual country to finance • OeEB (Austria)
development projects in a developing • BIO (Belgium)
• BMI-SBI (Belgium)
country and its emerging market. • FinDev Canada (Canada)
• IFU (Denmark)
Bilateral development agencies finance • Finnfund (Finland)
projects that contribute to the economic •• AFD/Proparco (France)
KfW/DEG (Germany)
and social development of recipient • CDP/SIMEST (Italy)
countries. • FMO (Netherlands)
• Norfund (Norway)
Bilateral DFIs are either independent • SOFID (Portugal)
institutions, such as the Netherlands • COFIDES (Spain)
Development Finance Company (FMO), • Swedfund (Sweden)
or part of larger bilateral development • SIFEM (Switzerland)
banks, such as the German Investment •• CDC Group (United Kingdom)
OPIC (United States)
• Other Regional Financial Institutions - Financial institutions of
neighboring countries established themselves internationally to
pursue and finance activities in areas of mutual interest; most of
them are central banks, followed by development and investment
banks.
International Bond Markets
• Foreign bonds
• Euro bonds
• Global bonds
International Equity Markets