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Global banking faces many challenges. While internationally active banks are the order of the day, small and medium banks have a role to play. Operational risk in banks acquires greater significance in the context of major frauds committed in the recent past. The US sub-prime crisis teaches banks not to dilute loan pricing and risk management standards, not to relax credit standards because of excess liquidity and not to resort to securitization and credit transfer mechanism, without proper appreciation of the attendant risks. Banking in the US will continue to experience a favorable environment but may face inadequate safeguards in the use of technology. In Europe, bank consolidation may provide a mixed bag. The EU accession countries have to continue with extensive structural and institutional reforms. Chinese banking has opted for public ownership through IPO route as a measure to strengthen banks through foreign ownership. It is a turnaround story for the major banks in Japan, which have embarked on radical reforms. Indian banking is strong, stable and vibrant but it faces the challenges of convergence, consolidation and competition. In future, customers will redefine the rules of the game and banks face intensified regulatory burden. While technology will be a critical element of success, banks need to focus on their core strengths and partner for everything else. Effective performance management and optimizing the potential of each customer relation are also the strategic imperatives. Global banking witnesses a paradigm shift and to manage transition, market participants need to understand the changing nature of risk in the context of increasing use of innovative and complex instruments. Bank disclosures need to keep pace with market developments and banks need to enhance governance standards.