Exchange bank deals mainly in the finance of the foreign trade of the country. It deals in foreign exchange. On the other hand, the main function of such bank is to buy and sell foreign currencies, rather titles to foreign exchange, drafts, telegraphic transfers etc. It purchases the bill of exchange which arises in connection with the import and export trade of the country and they deal in exchange.
The exchange banks liquidate the international indebtedness by exporting and importing precious metals and securities, if necessary. They purchase bills and in the international money market and deposit those with their banking agents in big commercial centers like London, Paris, New York etc. They draw and sell their own drafts on these deposit accounts.
The exchange banks liquidate the international indebtedness by exporting and importing precious metals and securities, if necessary. They purchase bills and in the international money market and deposit those with their banking agents in big commercial centers like London, Paris, New York etc. They draw and sell their own drafts on these deposit accounts.
Informative blog !
ReplyDeleteGood for commerce students and also for aged illiterates like me
Welcome to my blog Mr. Iftekhar Ajmal and thank you for your comment. :)
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