[经管营销]ch1 An Overview of Banks and Their Services.doc

Chapter 1 An Overview of Banks and Their ServicesImagine a World Without BanksOne way to answer your question is to imagine, for a moment, a world without banking institutions, and then to ask yourself a few questions. This is not just an academic exercise; many former eastern-block nations began facing this question when they began to create financial markets and develop market-oriented banks and other financial institutions. If there were no banks Where would you go to borrow money? What would you do with your savings? Would you be able to borrow (save) as much as you need, when you need it, in a form that would be convenient for you? What risks might you face as a saver (borrower)?It is said that the earliest bank is old-style Chinese private bank (money house)（钱庄）. In fact, money house was the place for keeping currency. That is to say, I keep money for you, you pay fee for me. Money house didnt use customers money. While modern banks borrow your money to others, require others to pay much more money and then return a little part to you. Bank itself cannot creat wealth, but it can make money alive by adjusting and restructuring social fortune. Nowadays, money hi-tech projects are laid aside without money. Whereas, the banks magic powermake much more money with a little own money. We will explore its secret by learning commercial bank operation and management. 1 Learning and Management Decision Objectives(1) What is a bank?(2) Introduction to commercial bankWhat is commercial bank?How many roles commercial banks play in the economy today?What is special?What is the features of commerical banks?(3) Commercial banks facing challenge all sides todayHow recent trends in banking, including increased competition, technological change, consolidation into larger firms, and globalization, can affect a bank managers decision making.2What is a Bank?As important as bankers are to the economy as a whole and to the local communities they call home, there is still much confusion about what exactly a bank is. A bank can be defined in terms of (1) the economic functions it serves and the services it offers its customers, or (2) the legal basis for its existence.2.1 The Economic Functions and the Services OfferedCertainly banks can be identified by the function they perform in the economy. Banks are those financial institutions that offer the widest ranges of financial services-especially credit, savings, and payment savings -and perform the widest ranges of functions of any business firm in the economy. Historically, banks have been recognized for the great range of financial services they offerfrom checking accounts and savings plans to loans for businesses, consumers, and governments. However bank service menus are expanding rapidly today to include security trading and underwriting, financial planning, the management of pension plans, advice for merging companies, and numerous other innovative services. Banks no longer limit their service offerings to traditional banking services but have increasingly become general financial-service providers.To add to the prevailing uncertainty about what a bank is, over the years literally dozens of organizations have emerged from the competitive financial marketplace proudly bearing the label of bank. As Exhibit 1-1 shows, for example, there are the Peoples Bank of China, the Commercial Bank, the Policy Bank, Credit Union, the Community Bank and Foreign Bank, etc.The Peoples Bank of ChinaCommercial Bank Policy Bank Credit Union Foreign BankEXHIBIT 1-1 The Different Kinds of Banks in ChinaName of Banking-Type Firm Definition or DescriptionThe Peoples Bank of China: A bank is responsible for controlling a countries monetary policy. It is normally the issuing bank and controls bank licensing, and any foreign exchange control regime. （banks bank, issuing currency bank）. We can divide the central banks duty into four general areas. (1) Conducting monetary policy; (2) Regulating banking institutions and protecting the credit rights of consumers; (3) Maintaining the stability of the financial system; (4) Providing financial services to the government.Policy Bank: A bank is established, owned or guaranteed by government. It is a financial institution which is specialized in policy financial activity to support developing economy, prompt social progress and matching macro-economic regulation, not for profit. It includes China Development Bank（中国开发银行）, Agricultural Development Bank of China（中国农业发展银行） and the Export-Import Bank of China（中国进出口银行）.Commercial Bank: Bank is taking deposits and making loans for profits. For example, Industrial & Commercial Bank of China, Agricultural Bank of China, Bank of China and Construction Bank of China, Bank of Communication, China Everbright Bank（中国光大银行） etc.Foreign Bank: Foreign bank is approved by Bank Monitoring Committee (银监会). It is classified as three types including Solely Foreign-owned Bank, Branch of Foreign Bank and Joint Bank. Credit Union: Bank is a cooperative finance organization by the masses such as rural and urban credit union. It composes of cooperative member. It provides them with various credit service.In this text we will spend most of our time focused upon the most Most important of all banking institutionsthe commercial bankwhich serves both business and household customers all over the world. However, the management principles and concepts we will explore in the chapters that follow apply to many different kinds of “banks” as well as to other financial-service institutions that now provide banklike services.(2) The Legal Basis for its ExistenceOne final note in our search for the definition of banks concerns the legal basis for their existence. When the Chinese government decided that it would regulate and supervise banks more than a century ago, it had to define what was and what was not a bank for purposes of enforcing its rules. After all, if you plan to regulate banks you have to write down a specific description of what they areotherwise, the regulated firms can easily escape their regulators, claiming they arent really banks at all. The government finally settled on the definition still used by many nations today: A bank is any business offering deposits subject to withdrawal on demand (such as by writing a check or making an electronic transfer of funds) and making loans of a commercial or business nature (such as granting credit to private businesses seeking to expand the inventory of goods on their shelves or to purchase new equipment). 3 Introductions to Commercial Bank3.1 Definition of Commercial BankA financial business provides comprehensive and multi-function services, such as accepting deposits and giving business loans for profits. It operates various financial assets and financial liabilities and creates credit by use of liabilities.商业银行追求最大利润为经营目标，以多种金融资产和金融负债为经营对象，能利用负债进行信用创造，并为客户提供综合性、多功能服务的金融企业。3.2 Commercial Banks Nature (Character)the business with modern enterprises basic characteristics（商业银行是具有现代企业基本特征的企业）the special business （商业银行是一种特殊的企业）the special financial business（商业银行是一种特殊的金融企业）3.2.1 The Business with Modern Enterprises CharacteristicsIt has its own equity capital for business operation（具有业务经营所需的自有资金）It self-operates for profits, independent accounting and self sufficiency.（以盈利为目的、自主经营、独立核算、自负盈亏）3.2.2 The Special Business(1) Special Operation Object（商业银行的经营对象和内容具有特殊性） An ordinary industrial and commercial business operates in product and service and engages in commodity production and circulation. Whereas a commercial bank operates in special commodity, currency and currency capital. Currency receipts-payments（货币的收付）Operation business Debt and credit（借贷） Other financial services relative to currency一般工商企业经营的是物质产品和劳务，从事商品生产和流通；而商业银行是以金融资产和负债为经营对象，经营的是特殊的商品-货币和货币资本，经营的内容包括货币收付、借贷以及各种与货币运动有关的或者与之联系的金融服务。（2）Speical Responsibility （商业银行责任特殊）An ordinary industrial and commercial business is only responsible for its shareholders and customers. In addition, commercial bank has to be responsible for the whole society.一般工商企业只以盈利为目标，只对股东和使用自己产品的客户负责；商业银行除了对股东和客户负责之外，还必须对整个社会负责。3.2.3 The Special Financial Business（一种特殊的金融企业）Commercial bank is a special financial business which is different from central bank, specialized bank and other non-bank financial institution.商业银行是一种特殊的金融企业，它既有别于国家的中央银行，又有别于专业银行（指西方指定专门经营范围和提供专门性金融服务的银行）和其它非银行金融机构。Central bank is the core of one countrys financial administrative bureau and financial system. It is the bank which issue currency, state bank, and the banks bank.中央银行是国家的金融管理当局和金融体系的核心，是货币发行银行、国家的银行和管银行的银行。即中央银行不会从事面向工商企业和个人的存贷款业务，中央银行的工作是发行货币、管理商业银行系统、向国家提供金融服务。中央银行是货币政策的制定和执行者。专业银行和各种非银行金融机构只限于办理某一方面或几种特定的金融业务，业务经营具有明显的局限性。Commercial banking activities are different than those of investment banking, which include underwriting, acting as an intermediary between an issuer of securities and the investing public, facilitating mergers and other corporate reorganizations, and also acting as a broker for institutional clients.Commercial banks activities cover wide and comprehensive scope. It operates both retail and wholesale business. With financial liberalization and innovation, modern commercial banks turn to full-service bank.而商业银行的业务经营则具有很强的广泛性和综合性，它既经营零售业务，又经营批发业务，其业务触角已延伸至社会经济生活各个角落。随着金融自由化和金融创新的发展，商业银行的业务和所提供的服务范围越来越广泛，现代商业银行正朝着金融百货公司和万能银行的方向发展。In brief, commercial banks nature contributes to the comprehensive and multi-functional financial business which operates financial asset and liabilities in pursuit of profits.总之，从商业银行的起源和发展历史看，商业银行的性质可以归纳为以追求利润为目标，以经营金融资产和负债为对象，综合性、多功能的金融企业。3.3 Commercial Banks FunctionCommercial banks play an important role in the financial system and the economy. As a key component of the financial system, banks allocate funds from savers to borrowers in an efficient manner. They provide specialized financial services, which reduce the cost of obtaining information about both savings and borrowing opportunities. These financial services help to make the overall economy more efficient.The investment banking (security underwriting) functionThe security brokerage (trading) functionThe payment (transactions) function functionOffering Trust ServiceThe thrift （savings） functionThe cash management functionSafekeeping of ValuablesThe investment/financial planning functionThe credit intermediation functionRisk managementEXHIBIT 1-2 Service Areas in the Modern BankTABLE1-1 The Many Different Roles Banks and Their Closest Competitors Play in the EconomyThe modern bank has had to adopt many new roles to adopt many new roles to remain competitive and responsive to public needs. Bankings principal roles (and the roles performed by many of its competitors) today includesThe intermediation role Transforming saving received primarily from households into credit(loans) for business firms and others in order to make investments in new buildings, equipment, and other goods.T The The payments role Carrying out payments for goods and services on behalf of customers (such as by issuing and clearing checks., Wiring funds, providing a conduit for electronic payments, and dispensing currency and coin).The The guarantor role Standing behind their customers to pay off customer debts when those customers are unable to pay(such as issuing letters of credit).T The risk management role Assisting customers in preparing financially for the risk of loss to property and persons.The savings/investment advisor role Aiding customers in fulfilling their long range goals for a better life by building, managing, and protecting savings.The safekeeping/certification of value role Safeguarding a customers valuables and appraising and certifying their true market value.The agency role Acting on behalf of customers to manage and protect their property or issue and redeem their securities (usually provided through a trust department. 3.3.1 Credit Intermediation RoleTransforming savings received primarily from households into credit (loans) for business firms and others in order to make investments in new buildings, equipment, and other goods.It shows in two aspects.Changing a small number of capitals into a large number of capitals（小额资本变大额资本）社会闲散资金分散在千家万户，这些小额的剩余资金难以直接转化为生产投资，但通过商业银行的中介作用可以聚小成多，将资金转化成资本。Banks operate by borrowing funds-usually by accepting deposits or by borrowing in the money markets. As table 1-2 shows, banks borrow from individuals, businesses, financial institutions, and governments with surplus funds (savings). They then use those deposits and borrowed funds (liabilities of the bank) to make loans or to purchase securities (assets of the bank). Banks make these loans to businesses, other financial institutions, individuals, and governments (that need the funds for investments or other purposes). Interest rates provide the price signals for borrowers, lenders, and banks. Table 1-2The table 1-2 provides a June 2001 snapshot of the balance sheet for the entire U.S. commercial banking industry. It shows that the bulk of banks sources of funds come from deposits - checking, savings, money market deposit accounts, and time certificates. The most common uses of these funds are to make real estate and commercial and industrial loans. Individual banks asset and liability composition may vary widely from the industry figures, because some institutions provide specialized or limited banking services.Transforming Short-term Capital into Long-term Capital(变短期资本为长期资本)Its intermediation role looks like reservoir which can regard stable short-term capital balance as long-term capital. It can finance by means of depositing and lending, not changing capitals ownership, but changing its right to use.商业银行的中介作用好比“蓄水池”，可以把稳定的短期资金余额当作长期资本使用。商业银行作为货币资本的贷出者和借入者实现货币资本的融通。商业银行通过信用中介职能实现资本盈余与短缺之间的调剂，并不改变货币资本的所有权，改变的只是其使用权。3.3.2 The Payment RoleCarrying out payments for goods and services on behalf of their customers (such as by issuing and clearing checks, wiring funds, providing a conduit for electronic payments and dispensing （分配）currency and coins).The advantages of the payment role is as follows. It can save circulation cost（节约流通费用）It can save cash and check in circulation to reduce cash safeguarding and transporting. (即节约流通中的现金与支票,减少了现金的保管、运输) To reduce financing cost because of balance.（降低银行筹资成本，因为有余额。）3.3.3 Credit Creation Function （信用创造职能）Commercial bank provides loan to customers and business by taking deposits. Then, it turns loan into derivative deposits to enlarge social currency supply. “Currency” is deposit currency not cash currency. It is only means for circulation and payment in account.所谓信用创造职能是指商业银行利用其可以吸收各类活期存款的有利条件，通过发放贷款，转化为派生存款，从而扩大社会货币供应量，当然，此种货币不是现金货币，而是存款货币，它只是一种账面上的流通工具和支付手段。如：A银行吸收到客户存入10000元，再根据法定准备金比率为20%。A银行的资产负债表资产 负债 在央行存款准备金 2000 存款 10000贷款 80008000元贷给客户，客户已存入B银行，B银行也提取存款资金准备金后，又贷出B银行的资产负债表资产 负债 在央行存款准备金 1600 存款 8000贷款 6400银行 存款 法定准备金 贷款A 10000 2000 8000B 8000 1600 6400C 6400 1280 5120D 5120 1024 4096What affects commercial banks credit creation?（商业银行信用创造受哪些因素影响）（1）the original deposit首先，商业银行信用创造，要以原始存款为基础。就每一个商业银行而言，要根据存款发放贷款和投资；就整个商业银行体系而言，也要在原始存款的基础上进行信用创造。因此，信用创造的限度，取决于原始存款的规模。（2）federal reserve ratio and cash leakage ratioIt is affected by Federal Reserve ratio and cash leakage ratio. It is positive with them.其次，银行信用创造要受中央银行法定存款准备率及现金漏损率的制约，创造能力与其成正比。（3）Demand for LoanWithout loan demand, the bank cant provide credit creation.最后，创造信用的条件，是要有贷款需求，如果没有足够的贷款需求，存款贷不出去，就谈不上信用创造，因为有贷款才有派生存款；相反，如果归还贷款，就会相应地收缩派生存款，收缩程度与派生程度一致。因此，对商业银行来说，吸收存款的多少具有非常重要的意义。Does financial institution providing loan creat credit? Because non-bank financial institutions cant draw call deposits, they cant creat currency. Because financial company cant take deposits, the total amount of money is limited.根据我国汽车金融公司管理办法规定，汽车金融公司有3种资金来源：一是注册资本金；二是接受境内股东单位3个月以上期限的存款；三是向金融机构借款。不能发行债券。由于这一点，非银行金融机构在运用其以吸收活期存款的其他方式所筹资金发放贷款时，就只能形成自己的资产、债权人对自己的负债，而不能像商业银行在发放贷款时那样，同时，形成自己对债务人的负债和债务人的资产，从而不能创造出新的货币。因此，金融公司不能创造存款，只是加速了商业银行所创造货币的周转速度。3.3.4 Risk Management FunctionAssisting customers in preparing financially for the risk of loss to property and persons. Commercial bank management risk is special as following. Commercial bank mangement risk instrument is non-standardizationThe tools which the bank manages risk are non-standardization, such as loan, guanator, loan promising etc. Take loan for example, different loan has different requirements such as whether the amount of loan, term, interest rate, or withdrawal and reimbursing arrangement. Loans with non-standardization meet with different customers requirement. Risk internalization in the process of managing riskRisk internalization means that commercial banks turn financial risks into risks assumed by i