Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail
Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

Eurobank

What it is:

A eurobank is a financial institution that makes loans and accepts deposits in foreign currencies -- simplifying international trade, transactions and investing.

How it works (Example):

If an American company wants to buy parts from a European company, it can use a eurobank to obtain the proper currency. Rather than holding foreign currency in its own account, an American company can simply pay a eurobank in dollars, and the eurobank will complete the transaction in euros.

Why it Matters:

Eurobank facilitates global trade and flows of capital between countries, promoting international economic growth and development. In addition to providing international financial services, eurobanks creates rate competition among banks and meets the demand of international investors wanting to hold foreign currencies.