It is obvious from the preceding list of costs and benefits from the development of multinational banking that the final word on them is not yet in. It may take years to the final assessment of the costs of the international debt crisis. The evolution of new private institutions needed for the generation of information in a deregulated environment is not complete and should continue to evolve in response to new technologies and institutions.

Judgments of the costs and benefits are also coloured by the analysts' faith in unregulated markets on the one hand and the ability of governments to improve welfare through regulation on the other. These characteristics of analysts are highly correlated with their political views. For this reason, the assessment of multinational banking, like that of most economic institutions, often has political overtones.

However, there is a technical and politically rather neutral policy issue concerning multinational banks. During the 1970s the U.S. Government initiated negotiations for the international, collective imposition of regulation of the industry, administered through the IMF, the Bank for International Settlements, or a similar institution. These initiatives went nowhere, as most governments correctly judged that such regulation would push the banks into other countries, which would only be too glad to open their doors to them. There exists no conceivable, voluntary mechanism that could assure that such shifting of bank activities would not take place.

A more sensible policy for the control of multinational banking would be to eliminate the distortion caused by domestic reserve requirements. Not only do these requirements result in distortions in domestic financial markets, they also represent a strong incentive for moving banking operations abroad and into foreign currencies, as noted above. The elimination of these incentives does not require the abandonment of reserve requirements. It would only be necessary to pay interest on the central bank deposits of the commercial banks. That this is so, can easily be seen from the above numerical analysis.