...The Function of Commercial Bank (A Class Bank) Commercial banks are responsible for adding customer deposits in a safe and liquid form and lending the proceeds to worthy commercial, industrial, governmental and nonprofit institutions. Commercial banks also provide market making activities in municipal, government and corporate bonds. Banks provide consulting and advisory services to customers as well as safekeeping and trust services. The function of commercial bank is categorized by primary and secondary function. The main functions of commercial banks are accepting deposits from the public and advancing them loans. Besides these functions there are many other functions which these banks perform. All these functions can be divided under the following heads: 1. Accepting deposits 2. Giving loans 3. Overdraft 4. Discounting of Bills of Exchange 5. Investment of Funds 6. Agency Functions 7. Miscellaneous Functions 1. Accepting Deposits: The most important function of commercial banks is to accept deposits from the public. Various sections of society, according to their needs and economic condition, deposit their savings with the banks. For example, fixed and low income group people deposit their savings in small amounts from the points of view of security, income and saving promotion. On the other hand, traders and businessmen deposit their savings in the banks for the convenience of payment. Therefore, keeping the needs and interests of various sections of society...
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...Functions of the Blood Bank: An Overview The American Association of Blood Banks (AABB) is one of the main or crucial international association of blood banks and this includes hospitals, community blood centers and transfusion and transplantation services, as well as those involved in transfusion and transplantation medicine. Standards concerning patient care and donors in all facets of blood banking, transfusion medicine, and hematopoietic, cellular and gene therapies are established by the AABB. It is usually the organization responsible for accreditation while the Food and Drug Administration (FDA) is the agency responsible for regulation. “The blood bank laboratory is a place of business where donated blood and blood products undergo extensive testing, and every task associated with the work performed is scrutinized to ensure the quality and safety of both the services and the products provided.” (Harmening 2012). It may be an isolated free-standing facility but is typically part of a larger laboratory associated with a hospital or community blood center. The blood bank is responsible for collecting, storing, processing and distributing human blood and blood products for the purpose of transfusion. The blood donated and collected is whole blood and is separated into red blood cells, plasma and platelets. Each of the preceding components can be separately transfused to different individuals depending on their needs. If the component to be prepared is platelets then the...
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...TRANSFORMATIONAL FUNCTIONS OF COMMERCIAL BANKS The commercial banks are playing a decisive role in the transformation function. Their value is essential in function of the creation of new money, in replenishing and regulating of money supply. They value less as a function of ensuring the sustainability of banking and money market as the pursuit for high profits pushing them to the most risky operations. Therefore, in this function a decisive importance is own to in central bank, but the role of commercial banks also should not be underestimated. Let’s stop more detailed on the transformational function of commercial banks. It includes several areas: * Transformation of risks; * Transformation of terms; * Transformation of capital; * Spatial transformation. Transforming of risks means that banks whose activities are associated with high risk, are taking appropriate measures that can reduce these risks to their investors and shareholders to a minimum. Such measures include: asset diversification, provisioning , differentiation of interest rates depending on riskiness of loans, deposit insurance etc. Thanks to these measures banks take on an overwhelming portion of risk of default on loans. Transformation of the terms means that mobilizing usual amounts of short-term funds and keep adding them, some banks may direct a part of them in long-term loans and other long-term assets. This is benefits not only for banks (they receive a higher income), but also for their...
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...What are the roles and functions of central banks? Why do they need Economic staff? How far should central banks get involved in data collection and areas such as seasonal adjustment, as well as economic analysis? Introduction Though Central Bank is viewed as one of the primary mechanisms of macroeconomic stabilization there are a number of arguments about other areas of Central Bank’s involvement. This paper will explore the different areas, including the role of Central Bank in effecting monetary policy and intervening body in exchange rate trades, Central Bank as a Last Lender Resort (LLR), and Central Bank as a regulatory body of the financial sector. Prior to further discussion, it is important to stress that the role of Central Bank and the scope of its involvement may vary due to the effect of different legislations and the presence of various stakeholders. Thus, US Central Bank does not act as a regulatory body of the financial sector (Driffill et al., 2005), whereas the intervention activity of Japan Central Bank requires the approval of other governmental bodies (Fujiwara, 2005). This paper discusses the importance of Central Bank's publications of economic forecasts and other information related to Central Bank's views of the further state of macroeconomic trends. The discussion shows that this information is highly important for other market players and forecasting agencies as it reduces the information asymmetry. The role of Central bank in macroeconomic stabilization ...
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...General Banking Function of a Public Bank A study on Agrani Bank Limited (ABL) An Internship report submitted in partial fulfillment of the requirement for the degree of BACHELOR OF BUSINESS ADMINISTRATION Prepared Under the Supervision of SaminaHaque Lecturer BRACBusinessSchool BRACUniversity Prepared By Md. Samiul Islam ID-05104119 Semester-Fall’2011 BRACBusinessSchool BRACUniversity SUBMISSION DATE-19 JANUARY, 2012 Letter of transmittal January 19, 20111 To SaminaHaque Lecturer BRACBusinessSchool BRACUniversity Subject: Submission of Internship Report Dear Ms. SaminaHaque: I am very much grateful to you for presenting herewith the Internship Report, as partial fulfillment of the Bachelor of Business Administration [BBA] program requirement. It is really an enormous prospect for me to congregate vast information and grasp the subject matter in an appropriate way. The report gave me the opportunity to know the practical implication of “General banking function of a public bank” An attempt has been made in this report to identify the financial management techniques followed by the Agrani Bank Limited and problems facing when implemented. I have tried my best to fulfill the requirements of this report. I am not anticipating that my analysis will assist you to provide a clear idea about ongoing activities of Agrani Bank Ltd. but you will find this report praiseworthy as I have put my best effort and labor on it. I am extremely obliged to you for your valuable...
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...Functions of the International Monetary Fund The function of the Monetary Fund (IMF) is to provide loans to its members. It hereby uses different programs to supply a short, medium and long term solution. For entering, each member is charged a fee or quota. IMF main role is to intercede when there is an invitation, but also when a country can’t realize their international debts. The own currency of the IMF is the special drawing right (SDR). In order to provide fundamental changes in governmental relationships it though needs a borrower. That’s why its resources for dealing with crises are limited. Functions of the World Bank After World War II the original purpose of the World Bank was to assist helping the implementation of the Marshall plan - providing financing aid and programs to support the rebuilding of Europe. Soon its financials were insufficient. For these reasons it shifted towards backing up the development of nonindustrial countries and their economics. Functions of the General Agreement on Tariffs and Trade In the beginning there was the International Trade Organization (ITO) with its purpose to reduce tariffs. When it died in 1948, the General Agreement on Tariffs and Trade (GATT) has risen instead, focusing on bringing down trade barriers progressively. Therefore, countries will meet periodically and negotiate. It has been very successful thus far, but ignored the sectors of agriculture, textiles and apparel. One indicator given is “that international...
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...The central bank of the country is the Reserve Bank of India (RBI). It was established in April 1935 with a share capital of Rs. 5 crores on the basis of the recommendations of the Hilton Young Commission. The share capital was divided into shares of Rs. 100 each fully paid which was entirely owned by private shareholders in the begining. The Government held shares of nominal value of Rs. 2,20,000. Reserve Bank of India was nationalised in the year 1949. The general superintendence and direction of the Bank is entrusted to Central Board of Directors of 20 members, the Governor and four Deputy Governors, one Government official from the Ministry of Finance, ten nominated Directors by the Government to give representation to important elements in the economic life of the country, and four nominated Directors by the Central Government to represent the four local Boards with the headquarters at Mumbai, Kolkata, Chennai and New Delhi. Local Boards consist of five members each Central Government appointed for a term of four years to represent territorial and economic interests and the interests of co-operative and indigenous banks. The Reserve Bank of India Act, 1934 was commenced on April 1, 1935. The Act, 1934 (II of 1934) provides the statutory basis of the functioning of the Bank. The Bank was constituted for the need of following: • To regulate the issue of banknotes • To maintain reserves with a view to securing monetary stability and • To operate the credit...
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...COMMERCIAL BANKS Commercial banks are important financial intermediaries serving the general public in any society. In most cases, commercial banks hold more assets than any other financial institution, in some cases, even more than Central Banks. Apart from their many functions, commercial banks facilitate growth and development. They lend in many areas or sectors of the economy. Viewed from the real sector, they contribute to investments, employment creation, and by extension the process of economic growth. In Trinidad and Tobago there are 8 commercial banks as follows; • Bank of Baroda (Trinidad and Tobago) Limited • Citibank (Trinidad & Tobago) Limited • FirstCaribbean International Bank (Trinidad & Tobago) Limited • First Citizens Bank Limited • Intercommercial Bank Limited • Republic Bank Limited • Scotiabank Trinidad and Tobago Limited • RBC Royal Bank (Trinidad and Tobago) Limited There are many other institutions such as credit unions, development banks, mutual funds to name a few. However, notwithstanding this commercial banks can be described as the head of the financial system. They are by far the largest mobilizers of savings and providers of loanable funds. They now account for over 50% of the total assets of the financial system and far more than half of the financial savings of the domestic economy. (See Table 1) Assets of the banking System (2001-2008) [pic]With all these resources...
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...Commercial Bank Commercial bank: Commercial bank mostly deals with deposits and loans from corporations or large businesses. Famous Commercial Banks of Pakistan are Muslim Commercial Bank(MCB),United Bank,Habib Bank. Functions of Commercial Banks: The functions of a commercial banks are divided into two categories: - Primary functions - Secondary functions including agency functions. - Primary functions: The primary functions of a commercial bank include: - accepting deposits; and - granting loans and advances The role of commercial banks Commercial banks engage in the following activities: * processing of payments by way of telegraphic transfer, EFTPOS, internet banking, or other means * issuing bank drafts and bank cheques * accepting money on term deposit * lending money by overdraft, installment loan, or other means * providing documentary and standby letter of credit, guarantees, performance bonds, securities underwriting commitments and other forms of off balance sheet exposures * safekeeping of documents and other items in safe deposit boxes * sale, distribution or brokerage, with or without advice, of insurance, unit trusts and similar financial products as a “financial supermarket” * cash management and treasury services * merchant banking and private equity financing * traditionally, large commercial banks also underwrite bonds, and make markets in currency, interest rates, and credit-related...
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...independence of the Compliance Function Date : 29th August, 2011 In reviewing last year regulator’ report on our bank, the bank have been imposed more than fifteen major violations from the regulators and some of the violations have got the bank into paying a huge amount of penalties. When penalties imposed the reputation of the bank will be at risk and this risk will lead the bank to financial loss. The bank has to redefine its risk measures and practices to avoid such failure in meeting regulators needs and meet all compliance requirements. Compliance Risk Our bank is conceder to be one of the leader banks nationally and internationally and in order to keep this position the bank has to manage its compliance risk strictly starting from compliance function. The very common practice which conceder to be an issue from a regulatory aspect is going through all the rules and regulations and stating we are in compliance with them and we are not 100% complied. Now it is the time for the bank to put a full stop on such kind of issues and focus on working on compliance risk by having an effective and efficient compliance function. Effective Compliance Function In April 2005 Basel Committee on Banking Supervision released a paper on Compliance and the Compliance Function in Banks. Over all the paper define and states the responsibilities of the Board of directors and senior management towards compliance and explain Compliance Function responsibilities with some other important...
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...What are Banks? Banks are the largest lending institutions through out the globe; the basic purpose of banks is to secure money of the people/organizations and to lend the money to the people/organizations as a creditor/lender. When they start returning money back to the bank either at once or in portions take interest on it. This interest is the prime source of the banks profit; interest is also known as “Usury”. The History of Banks The history of banks is old, but it is not exactly in that form which today we have, as we developed the way of banking and other related features are also changed. Initially people store money in the royal palaces and temples, at that time there were no concept of money they secure their grains and other commodities into it, the reason behind this they feel that these places are very secure and the chance of robbery or theft is very less as compare to secure in there own houses. Banking Today Today banks are playing very essential role in our country economy as well as in global economy; they are giving loans to the organization and individuals, trying to make humans life easier and developed. Without bank we cannot even think to live, for example how do you feel if someone says that I have one million or ten million dollar save in my cupboard locker, obviously you can laugh over the person wisdom? Now banks are providing greater facilities and constantly improving their standards day by day, Stronger security, locker facilities (where...
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...Commercial bank: Commercial bank mostly deals with deposits and loans from corporations or large businesses. Famous Commercial Banks of Pakistan are Muslim Commercial Bank(MCB),United Bank,Habib Bank. Functions of Commercial Banks: The functions of a commercial banks are divided into two categories: - Primary functions - Secondary functions including agency functions. - Primary functions: The primary functions of a commercial bank include: - accepting deposits; and - granting loans and advances The role of commercial banks Commercial banks engage in the following activities: * processing of payments by way of telegraphic transfer, EFTPOS, internet banking, or other means * issuing bank drafts and bank cheques * accepting money on term deposit * lending money by overdraft, installment loan, or other means * providing documentary and standby letter of credit, guarantees, performance bonds, securities underwriting commitments and other forms of off balance sheet exposures * safekeeping of documents and other items in safe deposit boxes * sale, distribution or brokerage, with or without advice, of insurance, unit trusts and similar financial products as a “financial supermarket” * cash management and treasury services * merchant banking and private equity financing * traditionally, large commercial banks also underwrite bonds, and make markets in currency, interest rates, and credit-related securities, but today...
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...Saving Banks Saving banks are established to create saving habit among the people. These banks are helpful for salaried people and low income groups. The deposits collected from customers are invested in bonds, securities, etc. At present most of the commercial banks carry the functions of savings banks. Postal department also performs the functions of saving bank. Type 2. Commercial Banks Commercial banks are established with an objective to help businessmen. These banks collect money from general public and give short-term loans to businessmen by way of cash credits, overdrafts, etc. Commercial banks provide various services like collecting cheques, bill of exchange, remittance money from one place to another place. In India, commercial banks are established under Companies Act, 1956. In 1969, 14 commercial banks were nationalised by Government of India. The policies regarding deposits, loans, rate of interest, etc. of these banks are controlled by the Central Bank. Type 3. Industrial Banks / Development Banks Industrial / Development banks collect cash by issuing shares & debentures and providing long-term loans to industries. The main objective of these banks is to provide long-term loans for expansion and modernisation of industries. In India such banks are established on a large scale after independence. They are Industrial Finance Corporation of India (IFCI), Industrial Credit and Investment Corporation of India (ICICI) and Industrial Development Bank of India...
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...Services offered by Nepalese Commercial Banks Introduction The term bank is either derived from old Italian word banca or from a French word banque both mean a Bench or money exchange table. In olden days, European money lenders or money changers used to display (show) coins of different countries in big heaps (quantity) on benches or tables for the purpose of lending or exchanging. A bank is a financial institution which deals with deposits and advances and other related services. It receives money from those who want to save in the form of deposits and it lends money to those who need it. A financial institution licensed as a receiver of deposits. There are two types of banks: commercial/retail banks and investment banks. In most countries, banks are regulated by the national government or central bank. Commercial banks are mainly concerned with managing withdrawals and deposits as well as supplying short-term loans to individuals and small businesses. Consumers primarily use these banks for basic checking and savings accounts, certificates of deposit and sometimes for home mortgages. Investment banks focus on providing services such as underwriting and corporate reorganization to institutional clients. According to Nepal Company Act 2031 B.S, a commercial bank refers to such type of bank which deals in money exchange accepting deposit advance loan and commercial transaction except specific banking related to co-operative agriculture industry and other objective. Basic...
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...finance Epoka University Table of contents Chapter 1 4 Financial system, meaning and its constituent’s elements 4 Chapter 2 5 Financial bank institutions. Meaning and their functions 5 Chapter 3 6 Banking System 6 Non bank financial institutions. Meaning and their functions 6 Chapter 4 9 The role of government in the credit market 9 The role of other financial credit institutions credit in financing the economy in Albania 9 The role of banks in lending activity in the country 10 Conclusions 11 Abreviations 11 Entry Progression and technological innovations are continuously effecting in a sensible way in every field of life, but especially and faster those has been felt in the Bank System. In now days, we are not only in front of a fast liberalization, globalization, but also in expanding financial market, updated always with new bank’s products. Albania is integrating everyday its self with this progress, despite national and international challenges that it faces time by time. Credit process has a main and important role in the economic progress, of financial system in our country. It is named like the locomotive that draws the most of economy growth. Since our agents are operating in a very flexible background, business world is more and more combined and conditioned by banks and financial institutions. Bank institutions are raising economy efficiency, through channeling of funds, by so contributing in the economic welfare of every individual, so they...
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