Professional Documents
Culture Documents
Peter S. Rose
Importance of Banking
Most important financial institution of the
economy.
Principal source of credit (loanable funds).
Mode of payments for purchase of goods
and services.
Advice and counsel for financial
information/ planning.
Bank reserves are the principal channel for
government economic policy to stabilize
the economy.
What is a bank?
Banks can be identified by the products/ services
they offer.
Not only are the banks functions changing but the
functions of their competitors are also changing.
Deposits should be insured by Federal Deposit
Insurance Corporation
banks are those financial institutions that offer the
widest range of financial services-especially credit,
savings and payment services-and perform the
widest range of financial functions of any business
firm in the economy.
Venture Capital
Giving equity to a brand
new idea-may just be
starting up, hence- more
risky
Looking for Rapid growth
10 times of our money in
few years with fair amount
of risk
Pure equity
Service proliferation
Rising competition
Deregulations
Rising funding costs
Technological revolution
Geographical expansion
Globalization of banking