1. Bedrijfsinformatica 3lesson 2

2. Banks Financial institution Licensed by a government Primary activities: Borrowing of money Lending of money Getting interest from borrowers Paying interest to its depositers Don’t forget fees and charges

3. Typology of banks Commercial bank Co-operativebanks Communitydevelopmentbanks Postal savingbanks Offshore banks Retailbank Savingsbank Ethicalbank Islamicbank Building societies & Landesbank Business bank Privatebank Investmentbank Central bank

4. Banks as large groups

5. Structure of a bank

6. Revenues, expenses and profits for the U.S. bankingindustry 2003 Total profit: $109.000.000.000,00

7. Customers of banks

8. Customers Retail Private clients that hold current accounts Private clients that have credit cards Private banking clients, i.e. clients with a large amount of capital Banks Other banks that borrow or lend money Corporates Companies that need a bank account Companies that need loans Companies that need other financial services Own activities Own investments in shares or real estate

9. So, whatactivities? Payment products Current account Cash Cash withdrawel Cash deposit Cards Debit cards (‘pay now’ cards), ex. Maestro Credit cards (‘pay later’ cards), ex. Visa, MasterCard Prepaid cards (‘pay before’ cards), ex. Proton, Chipknip

10. So, whatactivities? Payment products: Credit transfer non-SEPA domestic transfer non-SEPA cross-border transfer SEPA credit transfer (SCT) Direct debit Domestic direct debit SEPA direct debit Standing order Cheques

11. So, whatactivities? Electronic banking Internet banking / Online banking / PC banking Phone banking Self banking Mobile banking / SMS banking

12. So, whatactivities? Savings products Savings account ‘Ordinary’ savings account Online account with higher net rate Tax exemptable account Fixed-term diposit / term account Predetermined investment period Predetermined interest rate Bank savings certificates (ex. kasbons) Fixed interest rate Term as desired Custody in custody account (ex. effectendossier)

13. So, whatactivities? Investment products Funds (finance a company) Bonds (creditor of a company) (NL: obligaties) Pension savings Government bonds Shares (also called stock, owner of a company)

14. So, whatactivities? Lending: Mortgages Car loans Installment loan / refurbishment loans Student loans Consumer credit facilities Cash reserves

15. So, whatactivities? Other services: Foreign currency exchange Foreign trade support Asset management Financial markets services Safes

16. So, whatactivities? Wholesale banking Payments and cash management Electronic banking services Tailored solutions Remote debits Cash pooling Lending Overdraft Short term loan Investment credit Installment loan Guarantee

17. So, whatactivities? Financial markets Corporate and government debt Credit and equity derivatives Treasury products Interest rate derivatives Foreign exchange Structured products Securities financing Capital markets Corporate finance

18. Why do banks go broke? If the value of itsloans drops substantially When masses recalltheirsavings Due to: loansthatdon’tgetrepaidbecause the economy slows down Due to: a bignumber of fixedinterest rates for example on home-loans/mortageswhile the nominal interest rate rises. Makestheirloansworthless. Don’tforgetthatloans are oftensold to otherbanks

19. Creating money Banks ‘create’ money How? There is a process of lendingloans to otherpersons, companies or banks. For example: money on a bankaccountislended to others. In theirturn, that money willbelendedtoo. But the governmentregulates the core capital of a bank: Tier 1 capital

20. Tier 1 ratio The Tier 1 capital ratio is the ratio of a bank's core equity capital to its total assets The Tier 1 risk based capital ratio is the ratio of a bank's core (equity capital) to its total risk-weighted assets Regulator determines the ratio Cash and coins have zero risk weight while debentures might have a risk weight of 100%

21. Groepsopdracht 1 – Banken Groepen van ongeveer vijf personen Kies een bank uit en leg dit voor aan de docent via e-mail, na confirmatie kunnen jullie doorgaan of krijgen jullie een ander voorbeeld Ga voor deze bank na: Wat voor soort bank het is (retail, private, wholesale enz.) Wat de organisatiestructuur is Wat er voor informatie over IT in het jaarverslag staat Wat de (IT)-strategie van de bank is Wat voor electronic payment of home-banking producten ze aanbieden Wat het tier 1 ratio van de bank is Wat de ratings van de bank zijn, welk rating agency dit beweerd en in het kort waar ze naar kijken Wie de grootste aandeelhouders zijn Zoek op nieuws websites of bv Google Finance informatie over de huidige financiële situatie van die bank

22. Eisen aan de opdracht Deadline ligt op woensdag 7 oktober 2009 om 20u00 Te laatingeleverd of niet betekent nul puntenvoor de opdracht Correct Nederlands en nette opmaak Vermeld namen en opdracht naam op document Plagiaatzonderbronvermelding = fraude Digitaal inleveren via Hubwise Bereid een korte presentatie voor voor de les van 14 oktober