The US Banking System: Non-Bank Financial Institutions
Savings and Loans. Savings and loan associations, also known as S&Ls or thrifts, resemble banks in many respects. Most consumers don't know the differences between commercial banks and S&Ls. By law, savings and loan companies must have 65% or more of their lending in residential mortgages, though other types of lending is allowed.
Credit Unions. Credit unions are another alternative to regular commercial banks. Credit unions are almost always organized as not-for-profit cooperatives. Like banks and S&Ls, credit unions can be chartered at the federal or state level. Like S&Ls, credit unions typically offer higher rates on deposits and charge lower rates on loans, in comparison to commercial banks. In exchange for a little added freedom, there is one particular restriction on credit unions; membership is not open to the public, but rather restricted to a particular membership group
Private Banks. Private banks are increasingly part of larger commercial banks and international financial institutions. Almost every nationally known bank and financial services firm has a division that caters to wealthy clients. Private banks target high net-worth individuals and do not encourage, or in many cases accept, people of lesser means opening accounts. Private Banks look to provide a host of services beyond simple checking and savings accounts. Wealthy individuals often spend considerable resources sheltering their incomes and assets from the tax collector; tax planning, as well as the creation and sale of tax-minimizing investment projects, is a major service of private banks.
Investment and Merchant Banks. While investment banks may be called "banks," their operations are far different than deposit-gathering commercial banks. Investment banks are principally involved in underwriting debt and equity offerings, trading securities, making markets and providing corporate advisory services. Investment banks are also active counterparties in a variety of derivative transactions. Generally speaking, investment banks are subject to less regulation than commercial banks. While investment banks operate under the supervision of regulatory bodies, like the Securities and Exchange Commission, FINRA, and the U.S. Treasury, there are typically fewer restrictions when it comes to maintaining capital ratios or introducing new products.
Merchant banking has changed more than perhaps any other category of banking. Merchant banks used to exist to finance international trade, providing financing, letters of introduction and credit, for ocean-going voyages. Merchant banks then evolved into something more like what private equity is today; very few institutions call themselves "merchant banks" today.
|
|
|
Shadow Banks. The housing bubble and subsequent credit crisis brought attention to what is commonly called "the shadow banking system." This is a collection of investment banks, hedge funds, insurers and other non-bank financial institutions that replicate some of the activities of regulated banks, but do not operate in the same regulatory environment. Many estimates of the size of the shadow banking system suggest that it had grown to match the size of the traditional U.S. banking system by 2008.
Islamic Banks. Islamic banks exist to fill the need for financial services that are compliant with Islamic rules concerning interest. Sharia law forbids the charging, or acceptance, of interest or other fees related to borrowing money. In the place of interest, Islamic banks make use of profit sharing arrangements, "safekeeping" agreements, joint ventures, leasing and cost-plus accounting to extend credit in a way that is compliant with Sharia.
Industrial Banks. Industrial banks are a special category of financial institution that exists for very specific purposes. Industrial banks are financial institutions owned by non-financial institutions. As they are able to lend money, industrial banks are often used by their parent companies to facilitate financing for customers. Not all of these banks engage in lending; sometimes companies create industrial banks, simply to improve payment settlement efficiency and to reduce the costs of managing working capital accounts.
Text 2 9
History of Banking
Traces of banking can be found in the early history of Egypt, Babylonia, and Greece. The temples at these places practiced the early form of banking in the form of approving loans. These temples provided gold and silver which were deposited for safekeeping, as loans to the borrowers and charged high interest rates on those items. The private banking which was started in 600 B.C. was modified by the Greeks, Romans and Byzantines. Medieval banking was leaded mainly by the Jews and Levantine.
|
|
|
Next, emerged some particular purpose oriented banks like the Bank of Venice (1171) and the Bank of England, which looked after the loans to the government, and the Bank of Amsterdam (1694) was formed to receive the gold and silver deposits. With the development in the business sector, the banking sector also developed proportionately and the eighteenth and nineteenth century experienced the rapid growth in this sector.
In the modern times, the banking sector developed with the developing sector of trade and commerce. Today, there are different types of banks has been established for different purposes. These are the types of banks operating in today’s market:
Commercial Banks: This type of banking includes national and state-charted banks, stock savings banks, and industrial banks. This kind of banking service has provided many services to the society which includes the basic functions of savings, providing loans, dealing in time deposits, etc. The reserve requirements of these banks are totally different from the mutual saving banks.
Mutual Savings Bank: This type of banks provides some limited type of loans and deals in savings and other deposits. But recently the modifications have been done and now, these banks are also providing a huge number of facilities. In these banks, the investment and loan amount depends on the available customer’s deposits.
Once, the national level banks started rolling, the concept of international banking emerged. Actually, the growth in the trade and commerce, the growth in the exchanges between countries, the multi-national trades, etc. demanded some kind of international organization to carry out the business smoothly. So, the following international banks were formed in order to fulfill the demands of the modern global market:
World Bank (International Bank for Reconstruction and Development): It was founded in 1945 with the view to approve loans to private investors and to the governments of different countries.
IMF (International Monetary Fund): The bank has been involved in simplifying the process of debt clearance between the nations. It has also provided valuable suggestions to the members in the field of international banking.
|
|
|
The European Central Bank (European monetary system): Has been founded in 1998 to handle the joint monetary policy of those European countries, which have adopted a single currency.
Text 20
Mobile banking
Mobile banking is a way for the customer to perform banking actions on his or her cell phone or other mobile device. It is a quite popular method of banking that fits in well with a busy, technologically oriented lifestyle. It might also be referred to as M-banking or SMS banking.
The amount of banking you are able to do on your cell phone varies depending on the banking institution you use. Some banks offer only the option of text alerts, which are messages sent to your cell phone that alert you to activity on your account such as deposits, withdrawals, and ATM or credit card use. This is the most basic type of mobile banking.
A more involved type of mobile banking allows the user to log into his or her account from a cell phone, and then use the phone to make payments, check balances, transfer money between accounts, notify the bank of a lost or stolen credit card, stop payment on a check, receive a new PIN, or view a monthly statement, among other transactions. This type of banking is meant to be more convenient for the consumer than having to physically go into a bank, log on from their home computer, or make a phone call. While all of this is true, some are concerned about the security of mobile banking.
Most experts advise against performing any large transactions over mobile banking, which is good advice. However, it is equally important to use an alphanumeric password and to keep your PIN safe. Change your password often, and do not use your pets' names, your child's name, or any birthdays. This advice applies to all passwords, not just those used for mobile banking. Though you are logging on to a secure server at the bank through your cell phone, you need to do your part to protect your information. For this reason, many banks are now sending one-time use passwords for an extra step in security.
|
|
|
A one-time use password might be sent to a cell phone or other device when you wish to log into your account. You will then usually need to enter both the password you have already set, along with the one-time use password, within a certain period of time. The one-time use password expires, naturally, after it is used once or after a time limit has passed. Using two passwords increases the security of the account, an important concern with mobile banking.
Text 21
From Recession to Recovery
After almost two years of recession, Russia has entered a path to recovery. With global growth and trade starting to strengthen at the end of 2016, Russia’s economy showed signs of overcoming the recession caused by the shocks of low oil prices and economic sanctions. Tradable sectors benefitted from the relative price adjustment and stabilizing commodity prices in the second half of 2016, and became the main drivers of economic growth, partly through increased exports. There was a positive momentum in non-tradable sectors as well, which slowed the pace of contraction compared to 2015. The incipient positive momentum appears to have spilled into early 2017.
A moderate recovery of the global economy is expected for 2017, on the back of continued solid growth by commodity importers and a pickup in commodity exporters during the year. Russia is heading toward a moderate growth rate over the 2017-to-2019 period (between 1.3% and 1.4%), supported by rising oil prices and macroeconomic stability.
Russia had adapted well compared to other oil exporters. Oil prices plunged by 77% from June 2014 to January 2016, severely undermining the activities of energy exporters. However, the macroeconomic implications of the shock varied across countries. For Russia, growth adjustment happened earlier than for many oil exporters, reflecting the early impact of economic sanctions and the high inflation associated with the introduction of a floating exchange-rate regime.
Despite adverse terms-of-trade conditions in 2016 and continued restrictions on Russia’s access to international capital markets, the balance of payment remained stable, with the real effective exchange rate slightly depreciating. The current account surplus shrank as the trade surplus decreased on lower export receipts, especially in the first half of the year. An incipient import recovery was an additional negative factor for the trade balance in the second half of 2016.
Meanwhile, net capital outflows decreased on the back of lower debt payments. Relatively tight monetary policy increased interest in ruble assets and limited net capital outflows. Improved terms-of-trade conditions helped the current account in the first quarter of 2017, which translated into larger net capital outflows.
Unemployment in Russia decreased slightly, inflation slowed and real-wage growth resumed. But poverty also increased, as the sharp decline in pension income more than offset the incipient recovery in real wages. However, the prevalence of extreme poverty remained marginal.
Text 2 2
Digital Bank
Customers of digital bank WB21 will now be able to use bitcoin to transfer and deposit funds to their checking accounts. The bank has over half a million customers around the world, enabling them to make real-time deposits from bitcoin transfers into 18 local currencies currently offered by WB21.
WB21 will be using leading bitcoin payment processor BitPay to enable the feature. In essence, it is very likely that customers will be able to deposit bitcoin with zero confirmations, quickening the process to gain funds into their checking accounts. For a digital bank, accepting the biggest cryptocurrency of them all was a relative no-brainer.
“A bank accepting bitcoin is quite unusual, however it makes total sense for us and provides huge benefits to our clients,” stated WB21 founder and CEO Michael Gastauer. Gastauer highlighted the advantages of accepting a cryptocurrency that scales beyond borders and regulatory hurdles.
The problem some of our clients face is to make deposits if we don’t maintain a local account in their country. By accepting bitcoin, our customers can instantly transfer funds to their WB21 account from any country in the world.
As soon as they send bitcoin to our address, we credit the value in the currency the customer has selected to their checking account. These funds are available instantly in the customer’s WB21 account, which can then be transferred via wire transfers or used to load up a WB21 debit card.
He further added: The process to convert bitcoin into cash on a bank account is the fastest I am aware of. For us, the acceptance of Bitcoin is a great way to support our global roll-out and improve customers’ fund depositing experience.
While not a “legacy” bank, WB21 is still a licensed financial institution with a monthly payment volume of over $400 million transacted by some 700,000 customers across 180 countries. Accepting digital currencies and innovation shows that banks and bitcoin can co-exist and make for better banking for individuals.
Text 2 3
Дата добавления: 2019-01-14; просмотров: 516; Мы поможем в написании вашей работы! |
Мы поможем в написании ваших работ!