Euromarket bankers can narrow the spread between deposit and lending interest rates since the operating costs per dollar are lower than those faced in domestic markets.

Question

Quizplus · Accepted Answer

The euromarkets do not deal in small retail market transactions and so their administrative and operating costs are lower. In addition, loans tend to be for large amounts to medium and large corporations, financial institutions, governments and government agencies and so credit information costs are lower. Overall, their costs tend to be lower per dollar of business transacted.

Euromarket Bankers Can Narrow the Spread Between Deposit and Lending