Intro -- Contents -- I. INTRODUCTION -- II. SOME HISTORICAL PERSPECTIVE -- III. SIMPLE ANALYTICS OF GLOBAL INTEREST RATE DETERMINATION -- IV. AN ASSET-PRICING PERSPECTIVE -- V. ECONOMETRIC EVIDENCE -- VI. CONCLUSIONS -- APPENDIX I. THEORETICAL FRAMEWORK -- REFERENCES.

Studying a large number of banks in various countries between 1999 and 2006, we document that foreign banks perform better when from a high income country, when host country competition is limited, and when they are large and rely more on deposits for funding. Foreign banks' performance improves...