International banking activities are regulated for many of the same reasons that shape domestic banking regulation.These common reasons for regulation include:

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All of the options listed are valid and important reasons for regulating international banking activities. Restricting bank risk exposure helps to prevent banks from taking on overly risky activities that could potentially harm their customers and the wider economy. Protecting the safety of depositor funds ensures that people can trust banks with their money and that banks do not engage in fraudulent practices that could threaten the stability of the financial system. Promoting stable growth in money and credit helps to ensure that there is enough liquidity in the market for businesses and individuals to borrow and invest in order to grow the economy. Avoiding massive threats to economic health in individual nations is also critical, as economic instability can have severe consequences for individual citizens and the global economy as a whole.

International Banking Activities Are Regulated for Many of the Same