Interest bank loan –
The term interbank business refers to the global exchange of instruments (including funds, securities, foreign exchange, banknotes and coins, precious metals and derivatives) between credit institutions. This is a worldwide exchange of goods. Excluded are transactions between banks and their central banks in the intermediary banking business. In interbank transactions, money, foreign exchange, foreign currency and coins (money market) or securities (capital market) are traded on the interbank market at interbank prices. The Maxibank is an internationally valid money market interest rate in euros, which is paid between banks for unsecured euro investments with a maturity of up to 12 months.
For example, the Sentro Bank publishes reference prices on bank working days for banks that trade foreign currencies for what is known as the interbank exchange rate. All transactions in banking transactions are assigned to one of the following three classes: Trading on behalf of another person for the account of another person (open representation) is a banking service in the sense of 1 (1a) No. 2 No. 2 KG (final mediation) Acting in own name for the account of another person (hidden representation) is a banking trade within the meaning of 1 para. 1a no. 4 KG (financial commission business), acting in another person’s own name for the account of another person is one Bank services in the sense of § 1 para. 1a No. 4 KG (proprietary trading).
In the context of trading on behalf of a principal as an independent trader,
The bank does not act as a commission agent, but as a buyer or seller to its client. All EU interbank transactions are regulated by the regulation and other legal requirements and are supervised by the banking supervisory authorities, as the open items must be backed by own funds.
This removes an open position and no capital requirement is required. A credit institution conducts proprietary trading if its activity is not caused by the business with clients but is carried out by a bank in its own and someone else’s name. The (“open”) trading positions can also be increased or reduced in proprietary trading. As a result, own-account and customer-related business are not always clearly distinguishable.
In a full-fledged interbank market, all institutions work together without discrimination, while an incomplete interbank market is characterized by the omission of some institutions as participants in the market. In view of the fact that the interbank markets provide a substantial source of funding for the provision of loans to non-banks in normal times, it can be assumed that loans to non-banks will not be granted even if their origin no longer exists under unchanged conditions.