Given the intraregional trade flow, trade finance implies greater transaction banking opportunity, but the financial institutions have yet to grab the opportunity. As such, cross border presence and transactions of banks depends upon the size of capital and volume of transaction.
Further, regulatory and supervisory issues along with growing compliance requirement on anti-money laundering, know your customer (KYC) and level of home and host authority coordination are important determinants of cross border banking presence particularly when it is the case for branch banking. 9.