An examination of strategic alliances and the origins of international banking in Europe

Purpose - The purpose of the paper is to explain how and why strategic alliances, in the form of clubs and consortiums, played an important role in the internationalisation. of banks. Design/methodology/approach - A longitudinal analysis, commencing in 1964 with the emergence of the Eurocurrency market and culminating with the creation of the European single market in the early 1990s, is used to provide an insight into the creation of clubs and consortium banks. The authors adopt the Lawson realist methodology and identify broad structural changes in the markets in which banks operate, i.e. "mechanisms" and relate these to major trends, i.e. "events" such as the creation of strategic alliances. Findings - It is generally recognised that banks became international in response to the globalisation strategies of their multinational customers. However, the paper reveals that banks were also internationalising in response to structural changes in the financial services markets. Research limitations/implications - A criticism of the Lawson methodology is that it is not always possible to discern causal linkages between mechanisms and events. This explains why research of this kind is typically retrospective because it is only with the benefit of hindsight that the causal linkages can be fully understood. Originality/value - The study provides new insights into the emergence of international banking and the role of clubs and consortiums in this process.