100% satisfaction guarantee Immediately available after payment Both online and in PDF No strings attached
logo-home
Previously searched by you
Previously searched by you
logo
Samenvatting Slides en Lesnotities Bankmanagement (F710402B;Ugent;2023) $6.65
Add to cart
Quickly navigate to
Preview
  2.  
  3. Universiteit Gent (UGent)
  4.  
  5. Handelswetenschappen
  6.  
  7. Bankmanagement (F710402B)

Summary

Samenvatting Slides en Lesnotities Bankmanagement (F710402B;Ugent;2023)
 10 purchases
  • Module
  • Bankmanagement (F710402B)
  • Institution
  • Universiteit Gent (UGent)

This document is a summary of the slides and (very few, because not really necessary) course notes for the Bank Management course, given by M. Lamers. The summary is in English. For the recap lesson, only the extra slides were added; pure repetition was omitted. Guest lecture not included.

Preview 4 out of 38  pages

Document information

  • December 27, 2023
  • 38
  • 2023/2024
  • Summary

Subjects

  • bank
  • 2023
  • martien lamers
  • commercial sciences
  • master
  • finance
  • risk management
  • ugent
  • prof lamers

Written for

  • Universiteit Gent (UGent)
  • Handelswetenschappen
  • Bankmanagement (F710402B)
All documents for this subject (4)

Seller

avatar-seller
studentje789

Reviews received

Content preview

BANK MANAGEMENT
PROF. M. LAMERS

,LECTURE 1: WHAT ARE BANKS?

WHAT ARE BANKS

What do we use banks for?
o Save our money: store of wealth (savings accounts)
o Use our money: payment methods e.g. checking account, debit/credit card, Bancontact, mobile banking, currency exchange, …
o Get loans e.g. mortgage, personal loan, car loan, student loan, business loan, …
o Invest e.g. term accounts, bonds, equities, pension saving, funds, …
Via bank or associated entity
o Insurance e.g. car insurance, life insurance, family insurance, travel insurance, …

Definition bank according to ChatGPT: “Banks are financial institutions that play a crucial role in the modern economy by
providing a wide range of financial services to individuals, businesses, and governments.”

Balance sheets and income statements usually tell how a business works.
o Assets = what you own (left on the balance)
o Liabilities = what you owe (right on the balance)
o Equity = difference between assets and liabilities

ð Banks (and other financial institutions) have a different asset and liability structure compared to other firms! E.g.
banks do not have an inventory


BALANCE SHEET

Financial liabilities
o Deposits (main source of funding)
• Sign deposits: no interest rates, demandable on sight
• Savings deposits: low interest rates, demandable
• Term deposits: (generally) higher interest rates, fixed term
• Wholesale/corporate deposits
• Interbank deposits

o Bonds
o Subordinated debt
o (Equity capital) ⇾ Banks typically have less equity compared to other firms
• Share capital
• Retained earning
• (Subordinated debt)

ð The equity capital buffer is quite small for banks (around 5-6%)
* Defence against non-performing assets
* Regulation (Basel III) mainly concerned with maintaining high enough equity buffers

Financial assets
o Cash
o Loans
• Mortgages
• Consumer credit
• Business loans
• Credit lines
• Interbank loans
• (Local) government loans

o Securities (incl. govt)
• Some very liquid and not so risky

2

, * Treasury notes (< 10 years)
* Treasury bonds (> 10 years)

• Some more risky, but also higher return
* Corporate bonds
* Equities
* Trading assets

o Fixed assets – Branch network
• ‘Brick and mortar’
• Role used to attract new clients, wire transfer money
• Less necessary due to internet banking
• More based on giving advice e.g. about mortgages
• In combination with fixed high costs, banks are closing down branches


BANK INCOME STATEMENT

Income
o Lending
o Investing in other financial assets yielding a return
o Providing services

Expenses
o Funding costs (deposits and non-deposit liabilities)
o Personnel costs
o Costs of running branch network
o Etc.

Decomposing
o Income:
• Net interest income is the largest part of total income
• Other types of income: trading, insurance activities, fee income e.g. private banking, wealth management

o Costs: operational (personnel), reserves (for bad loans)

WHAT DIFFERENT TYPES OF BANKS ARE THERE?


TYPES OF BANKS

Depending on which business/funding is dominant, Fls (= funding for lending schemes) can be divided into different business
models ⇾ Saunders and Cornett define a few:
o Depository institutions
• High proportion of funding from (retail) deposits, and main source of income real estate loans
• Commercial banks, savings banks, credit unions

o Finance companies
• Do not accept deposits, but rely on short- and long-term debt as source of funds
• Often give more risky (personal) loans

o Securities firms
• Investment banks (originate, underwrite, distribute new securities)
• Brokerage firms (purchase, sale of existing securities)

Types
o Retail banks: consumer deposits, consumer loans, mortgages, small business loans (checking/savings accounts,
overdrafts, loans, credit & debit cards, safe deposit boxes)
3

, o Wholesale bank (corporate bank): deposits/loans to large companies, governments, pension funds, etc.
o Investment bank/brokerage: fee/commission generating business (asset management, M&A, securities trading, raising
capital, securities underwriting)
o Universal bank: offer all the above (one-stop-shopping)


TYPES OF BANKS IN EUROPE

Universal banks e.g. BNP Paribas, Société Générale, Credit Agricole, KBC, Deutsche Bank, Barclays, HSCB, RBS
o Allowed in EU since Second Bank Directive (1989), in US since Financial Services Modernization Act (1999)
o Large listed banks, offer brokerage services (no real investment banks)

Commercial (retail) banks: mainly smaller, often non-listed e.g. Sparkassen in Germany, Argenta, Triodos

Wholesale banks e.g. Landesbanken in Germany, Lloyds, Commerzbank


BANKS IN BELGIUM

Leading banks
o BNP Paribas/Fortis, KBC, Belfius, ING Belgium
o All offer retail/wholesale banking, insurance, asset/wealth management ⇾ Sometimes via subsidiaries/partnerships e.g.
ING and Nationale Nederlanden, Belfius and Candriam

Others
o Retail banks e.g. Argenta, Beobank, Crelan/Axa, Europabank, Triodos, VDK bank
o Finance companies (personal loan/consumer credit) e.g. Cofidis, Fimaser (Carrefour Finance)
o Branches of foreign banks e.g. Bank of New York Mellon, Deutsche Bank, Banco Santander

RECAP

Key question: What are banks?
o Banks are financial service providers
o Variety of business models
• Retail bank
• Wholesale bank
• Investment bank/brokerage
• Universal bank

ð But more often they offer two or more types of services: “A continuum rather than a discrete set of strategies”

LECTURE 2: WHY DO BANKS EXIST?

WHY DO BANKS (OR OTHER FINANCIAL INTERMEDIRIES) EXIST?


FINANCIAL INTERMEDIATION

Allocation of resources from those with surpluses (and
no use) to those with need and productive use ⇾ Can
be done directly (via stock/bond markets) or indirectly
via banks




4

The benefits of buying summaries with Stuvia:

Guaranteed quality through customer reviews

Guaranteed quality through customer reviews

Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.

Quick and easy check-out

Quick and easy check-out

You can quickly pay through credit card for the summaries. There is no membership needed.

Focus on what matters

Focus on what matters

Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!

Frequently asked questions

What do I get when I buy this document?

You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.

Satisfaction guarantee: how does it work?

Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.

Who am I buying these notes from?

Stuvia is a marketplace, so you are not buying this document from us, but from seller studentje789. Stuvia facilitates payment to the seller.

Will I be stuck with a subscription?

No, you only buy these notes for $6.65. You're not tied to anything after your purchase.

Can Stuvia be trusted?

4.6 stars on Google & Trustpilot (+1000 reviews)

71250 documents were sold in the last 30 days

Founded in 2010, the go-to place to buy revision notes and other study material for 15 years now

Start selling

Recently viewed by you

Exam (elaborations) ·

(0)

Electrician Chapter 1 Study Questions With Complete Solutions

Essay ·

(3)

Moduleopdracht Schoevers: Tools voor de virtual support professional

Exam (elaborations) ·

(0)

NUR 615 ADVANCED PHARM TEST BANK FOR EXAM 2 REVIEW QUESTIONS

Exam (elaborations) ·

(0)

Nyc Tour Guide License Real Exam Question And Answers Latest Update

Exam (elaborations) ·

(0)

NURS 3000 FINAL EXAM QUESTIONS AND ANSWERS UPDATED 2024-2025 (GRADED)

Exam (elaborations) ·

(0)

DVA3706 Assignment 3 (ANSWERS) Semester 1 2024 - DISTINCTION GUARANTEED

Summary ·

(0)

Samenvatting Natuurkunde - Newton - Havo 4 - Hoofdstuk 4 - Sport en verkeer

Exam (elaborations) ·

(0)

Psychology: Human Growth and Development Test 1 Graded A+(100% Verified)

Summary ·

(0)

Zeer uitgebreide samenvatting Microbiology & Biochemistry MIB10306

$6.65  10x  sold
  • (0)
Add to cart
Added