Bank for International Settlements
The Bank for International Settlements (BIS) is an international financial institution that serves as a bank for central banks. Here are some detailed insights into its history, functions, and context:
History
- Established on May 17, 1930, under the Hague Agreements, following the Young Plan to facilitate reparations payments post-World War I.
- Originally located in Basel, Switzerland, where it continues to operate from today.
- During the 1930s, BIS played a role in facilitating financial transactions between nations, including those under Nazi control, which raised ethical concerns later on.
- After World War II, its role was redefined to promote international monetary and financial stability.
Functions
- Bank for Central Banks: Provides banking services to its member central banks, including safekeeping of reserves and facilitating international financial transactions.
- Forum for Cooperation: Acts as a platform for discussion and cooperation among central banks on matters related to international financial stability.
- Research and Analysis: Conducts economic and financial research, publishes reports, and hosts regular meetings like the Basel Committee on Banking Supervision to set international banking standards.
- Standard Setting: Plays a key role in developing standards for international banking regulation, including the Basel Accords.
Structure
- The BIS is owned by 63 central banks, representing countries accounting for about 95% of world GDP.
- Its governance includes a Board of Directors, elected by the General Meeting of the member central banks.
- The General Manager is the chief executive of the BIS, currently Agustín Carstens since December 2017.
Controversies and Criticisms
- Historically, the BIS was criticized for its involvement with Nazi Germany during the 1930s.
- Its role in international financial secrecy and the lack of transparency in its operations have been points of contention.
Sources
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