Definition
The full form of BIS in finance refers to the “Bank for International Settlements”. It is an international financial institution that serves as a bank for central banks. The BIS aims to promote monetary and financial stability around the world.
Key Takeaways
- The full form of BIS is the Bank for International Settlements, which functions as a bank for central banks across the globe.
- BIS is crucial in assisting central banks to negotiate and implement financial and monetary cooperation globally. It also offers stability and financial aid during monetary and financial crisis.
- Last but not least, BIS also serves as a forum for central banks to share information and implementation strategies on monetary and financial stability matters.
Importance
BIS stands for Bank for International Settlements, an international financial organization that serves as a bank for central banks.
The importance of BIS lies in its role to promote monetary and financial stability around the world.
BIS achieves this through fostering cooperation and facilitating dialogue among central banks, providing them with high-quality research and statistics, offering banking services to central banks, and acting as a hub for central banks to exchange information and set international standards.
Understanding the full form of BIS is crucial in the context of international finance as it provides insights into the global financial system’s stability and the regulatory frameworks central banks operate within.
Explanation
The full form of BIS refers to the Bank for International Settlements. Established in 1930, it is an international financial institution widely recognized as the ‘ bank for central banks.’ The Bank for International Settlements is owned by 63 central banks globally, representing nations from around the world that together form about 95% of world GDP.
The primary purpose of BIS is to promote monetary and financial stability across the world. Unlike commercial banks, BIS doesn’t interact with individual customers or corporate entities, instead, it acts as a bank for central banks and fosters international financial cooperation.
For example, it provides a place for these institutions to lodge or borrow money, and it also offers a venue for discussion and policy analysis among central banks and within the international financial community. Moreover, BIS plays a crucial role in research and development in the area of monetary and financial stability issues, thus contributing significantly to the understanding of key trends in the global economy and the financial system.
Examples of Full Form of BIS
BIS stands for Bank for International Settlements. Here are three real-world examples related to this financial institution:
BIS Basel Accords: The Bank for International Settlements has come up with a set of recommendations known as the Basel Accords. The Accords, particularly Basel III, provide standards to regulate banks’ capital reserves to safeguard against financial risk. These standards are used throughout the world, including large economies like the United States, European Union, and Japan.
BIS’s role in financial crisis: During the global financial crisis of 2008, the BIS played an instrumental role in coordinating central banks’ actions. They provided a platform for central banks to come together and discuss the crisis, leading to coordinated actions that aimed at stabilizing the global financial system.
BIS Triennial Central Bank Survey: This survey is conducted every three years to collect data on the structure and operation of foreign exchange and over-the-counter (OTC) derivatives markets. It provides central banks, policymakers, and market participants with information about the growth and structure of these markets. The 2019 survey, for instance, showed an increase in daily turnover of foreign exchange transactions globally.
Frequently Asked Questions about BIS
What is the Full Form of BIS?
The full form of BIS is Bureau of Indian Standards. It is India’s national standards body which functions under the aegis of the Indian Ministry of Consumer Affairs, Food & Public Distribution.
What is the Role of BIS?
The main role of BIS is to provide and promote the Indian Standard specifications. It is involved in the development of technical standards, product quality certifications, hallmarking of precious metal articles, and more.
What does BIS Certification Mean?
BIS certification refers to the mark of safety and reliability given to a product. The certification denotes that a product confirms to the standards set by BIS and is safe for consumer use.
Is BIS Certification Mandatory?
For certain products, BIS certification is mandatory before they can be sold in India. Many products are covered by mandatory standards, check with the official BIS website or consult with a certification professional for details specific to a product.
Related Entrepreneurship Terms
- Bank for International Settlements: The Bank for International Settlements (BIS) is an international financial institution that serves as a bank for central banks. Its primary purpose is to promote monetary and financial stability around the world.
- Financial Stability: This term refers to the financial system’s capacity to facilitate and enhance economic processes, manage risks, and absorb shocks. Central banks and international financial institutions like the BIS often work to maintain financial stability.
- Central Bank: A central bank or reserve bank is a financial institution that manages a country’s currency, money supply, and interest rates. They also usually oversee the commercial banking system of their respective countries.
- International Financial Institutions: These are financial institutions that have been established by more than one country, and hence are subjects of international law. Their owners or shareholders are generally national governments, but they could also be other international institutions. BIS is an example of IFI.
- Monetary Policy: This refers to the actions undertaken by a central bank, like BIS or a country’s central bank, to control the amount of money in an economy and the interest rates at which this money is lent.
