What is the Bank for International Settlements?
The Charter was issued to the “Central Banks” of Belgium, France, Germany, Great Britain, Italy, Japan (withdrew in 1969), and “a financial institution of the United States of America.” The U.S. financial institution is defined as a banking group “including J.P. Morgan & Company; First National Bank of New York; and the First National Bank of Chicago.” It is interesting, and perhaps significant, that the U.S. Federal Reserve did not participate in this new international organization, but major private banks were included. Actual ownership of the BIS was conveyed in the form of 600,000 shares, subscribed at the rate of 2,500 gold francs per share. (1 gold franc = .29 grams of fine gold, equal to approximately $1.94). Each central bank owner was given the option of subscribing the shares, or arranging for their shares to be purchased by private investors. All of the shares allocated to the U.S. financial institution were acquired by private investors.
By: Emily Marriott October 2007 The Bank for International Settlements (BIS) is the oldest of all the international financial organizations. The BIS coordinates the activities of national banking regulatory and supervisory bodies to oversee and regulate banking challenges on a global level. This FAQ provides an overview of the BIS by examining its history, its basic structure, the work of its committees, the services it provides to central banks, and its current role in the international financial community. I. History of the BIS The BIS was formed in 1930 under the Young Plan, which was the plan for settling German reparation debts following World War I. The Young Plan directed the BIS to administer the payments imposed on Germany. Central banks of six nations—Belgium, France, Germany, Italy, Japan, and the United States—funded the BIS and selected Basel, Switzerland as its location. The countries chose Switzerland because of its neutrality and minimal exposure to undue influence from
