INTERNATIONAL BUSINESS PRACTICES

International Business Practices



International Business Practices

Introduction

Even in the relatively expanding wealth management sector, international banks have taken their foot off the gas when it comes to expansion. Regional, private banks have come to the realization that if they want to attract private bankers from international players, they will have to dig deep. For the right people, packages can be up to 20-25% bigger at regional banks. With reference to global expansion of a regional bank, this paper would be discussing Citibank entrance in UAE (Moreno, 2011).

Advantages of Expansion

As Citibank is an American bank setting up in UAE, therefore, regional, private banks may have the added selling point of having closer local ties, as well as access to legacy accounts. The downside of working for a regional player is, well, being tied to the region. Some international wealth managers remain in the market for expansion, but a cautious outlook has led many to scale down recruitment plans. Nonetheless, even the more unresponsive institutions are replacing departing employees, and, this is happening more than they would like. Regional UAE players have more freedom, and are still able to bring top tier people in on guarantees. Banks are competing for the same small band of very well-regarded people and, common name hires are seen as a coup. On the other, rank and file private bankers are given very little time to impress. Recruiters suggest that, in some international banks, private bankers are given just six months to come good on their promises.

Political and legal systems

The political system in a global environment includes law across borders. When law between two countries is different, it becomes difficult to specify the laws which would be applicable. Settlement is achieved through treaties or actions such as compulsion. The most common approaches to law worldwide are common law, code law, Islamic law and socialist law. Common law works on the tradition of precedent. This law is common in America. Code law is common in Europe where judges are given considerable shorter flexibility. Islamic law is derived from the Holy Book of Muslims where the usury and interest is prohibited. This law is adopted by Islamic countries such as in UAE. Socialist law supports the statement that the government is always right. Former communist countries sued to follow this law. America has a few laws on forms doing business globally. The laws include the Foreign Corrupt Influences ...