The goal of the IBF plan is to allow banking offices in the United
States to compete with offshore banks without having to use an offshore banking office. The location of IBFs reflects the location of banking
activity in general. It is not surprising that New York State, as the finan-
cial center of the country, has over 75 percent of IBF deposits.
Aside from New York, California and Illinois are the only states with a
significant IBF business. After IBFs were permitted, several states encouraged their formation by granting low or no taxes on IBF business.
The volume of IBF business that resulted mirrored the preexisting volume
of international banking activity, with New York dominating the level of
activity found in other states.