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Categories of bank |
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Categories of Banks
Banks have categories been distinguished according to their Categories of banks according to their functions. Commercial banks, which include national- and state-chartered banks, trust companies, stock savings banks, and industrial banks, have traditionally made a wide range of services in addition to their primary functions of making loans and investments and handling demand as well as savings and other time deposits. Mutual savings banks, until recently, accepted only savings and other time deposits, and offered limited types of loans and services.Differrent types of banks the fact that commercial banks were able to expand or contract their loans and investments in accordance with changes in reserves and reserve requirements further differentiated them from mutual savings banks, where the volume of loans and investments was governed by changes in customers' deposits.
Savings and loan associations and cooperative banks were established during the 1800s to make it possible for factory workers and other lower-income workers to buy homes. People who shared a common bond, like working at the same company or living in the same community were started the Credit Unions. The credit union's main function was to provide emergency loans for people who couldn't get loans from traditional lenders.
International Banks
The World Bank was organized in 1945 to make loans both to governments and to private investors. The discharge of debts between nations has been simplified and facilitated through the International Monetary Fund (IMF). The former European Monetary Agreement made possible the rapid discharge of debts and balance of payments obligations between nations. The European Central Bank was established in 1998 to help formulate the joint monetary policy for European Union nations adopting a Euro.
History of Banking:
A simple form of banking was practiced by the ancient temples of Egypt, Babylonia, and Greece, which loaned at high rates of interest the gold and silver deposited for safekeeping. Private banking existed by 600 B.C. and was considerably developed by the Greeks, Romans, and Byzantines. The Jews and Levantines dominated medieval banking. The forerunners of modern banks were frequently chartered for a specific purpose, e.g., the Bank of Venice (1171) and the Bank of England (1694), in connection with loans to the government; the Bank of Amsterdam (1609), to receive deposits of gold and silver. Banking developed rapidly throughout the 18th and 19th century accompanying the expansion of industry and trade, with each nation evolving the distinctive forms peculiar to its economic and social life.
The new face of banking
Banks of the Future survey shows that the lesser players in the global banking league, in Africa, Asia and the Middle East, are gaining ground in profitability on the banks of the US and Europe. The world?s smaller banks, like their larger competitors, are reflecting the global trends towards improved profitability, increased consolidation and greater efficiency. In The Banker?s Banks of the Future survey ? ranking the world?s 1001-2000 largest banks on their latest annual results ? the aggregate pre-tax profits of 1000 banks reached $22.3bn, more than double the total two years ago. While this aggregate profit is minuscule compared to the $417.4bn posted by the world?s Top 1000 banks, it does represent a significant boost in profitability, with the aggregate Banks of the Future posting an overall return on Tier 1 capital of 27.4% compared to 14.3% two years earlier.
Like the Top 1000, the listing is dominated by US and European banks, which, combined account for 798 of the 1000 banks. This number, however, has dropped from the 848 total in our 2002 listing, as Latin American banks have increased to 59 from 36 and other regions have strengthened their position ? African banks totalled 17, Asia has 62 and the Middle East 40. Colombia?s Banco de Occidente, with Tier 1 capital of $171m, heads the Banks of the Future listing while India?s Vijaya Bank heads the Asian list. Sharjah?s Invest bank leads the Middle East, while Commercial Bank of Ethiopia, at 1031, is the top ranking sub-Saharan bank. The dominant 509 US banks account for 47.5% of aggregate capital and 37.8% of aggregate assets. The 289 European banks account for 30.4% of capital, while achieving a relatively high 37.1% of the asset total.
ATM & Debit News (September 2001).
Bank for International Settlements, Statistics on Payment Systems in the Group of Ten Countries, 1999.
Business Week, ?The Future of Money,? (June 12, 1995), p. 70.
Credit Union Magazine, ?ATMs are growing up,? (March 1983), pp. 8-14 .
Federal Reserve Bank of Philadelphia, Business Review (Third Quarter 2001).
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