Over the last decades or so, a number of events have occurred that fostered unprecedented opportunities and challenges to the whole world economy. The preeminent driving force behind these events has been a series of systemic technological and political changes ranging from liberalisation of trade policies, privatisation processes and globalisation of markets (Dunning 1995; Miller and Parkhe 1998; Berger et al. 1999; Mallampally and Zimny 2000). Service sectors and, particularly, financial and banking sectors, have experienced a season in which both the products offered and the regulatory framework have undergone significant changes. The range of products available to multinational banks (MNBs) has expanded significantly, and at the same time many of the domestic banking markets, within which the MNBs also compete, have undergone significant regulatory reforms (Dewatripont and Tirole 1994; Williams 1997). In fact, at the end of the 1990s the world FDI outward stock in the tertiary sector accounted for 54.7 per cent of the total, and the inward stock for 50.3 per cent. Financial services constituted 27.3 and 16 per cent of the total of services, respectively (UNCTAD 2001).