Foreign Banks in the Pacific: A Note.

Adrian E. Tschoegl, Wharton School of the University of Pennsylvania

Abstract

Foreign banks have been operating in the Pacific Islands since the late 19th century. Today, Pacific banking markets are more highly segmented into separate national banking systems than they were from about 1975 to 1995. Since then, we have seen a consolidation into three essentially unconnected spheres of influence, with each sphere being defined by and dominated by banks reflective of the political and economic geography of the sphere. In the Australian banks’ sphere, two Australian banks dominate. In the French banks’ sphere, three French banks dominate. The situation in the US banks’ sphere is a little more diverse, though in all three spheres there are situations of monopoly.