Final answer:
The European banking and financial system created a pool of capital, aiding the rise of global trade and European overseas expansion due to banking innovation and joint-investment ventures.
Step-by-step explanation:
Changes to the European banking and financial system helped create a pool of capital, which in turn catalyzed trading ventures and overseas expansion. The growth and sophistication of financial institutions during the later Middle Ages and the Renaissance, such as banks and joint investment schemes, played a crucial role in funding exploration and enabling the increase in global trade. Financial innovations like the commenda provided a way for investors to fund merchants, fostering trade networks and the expansion of European influence. These economic developments contributed significantly to the world economy and had profound political impacts, inclining European countries toward colonization and empire building.