1 10 Can you explain why many of the forces you named in the answer to the

1 10 can you explain why many of the forces you named

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enter countries overseas and attract away profitable domestic business and household accounts. 1-10 Can you explain why many of the forces you named in the answer to the previous question have led to significant problems for the management of banks and other firms and their stockholders? The net result of recent changes in banking and the financial services market has been to put greater pressure upon their earnings, resulting in more volatile returns to stockholders and an increased bank failure rates. Some experts see banks role and market share shrinking due to restrictive government regulations and intensifying competition. Institutions have also become more innovative in their service offerings and in finding new sources of funding, such as off-balance-sheet transactions. The increased
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risk faced by institutions today, therefore, has forced managers to more aggressively utilize a wide array of tools and techniques to improve and stabilize their earnings streams and manage the various risks they face. 1-11 What do you think the financial - services industry will look like 20 years from now? What are the implications of your projections for its management today? There appears to be a trend toward continuing consolidation and convergence. There are likely to be fewer financial service providers in the future and many of these will be very large and provide a broad range of financial services under one roof. In addition, global expansion will continue and will be critical to the survival of many financial service providers. Management of financial service providers will have to be more technologically astute and be able to make a more diverse set of decisions including decisions about mergers, acquisitions and global expansion as well as new services to add to the firm. 5-1.What are the principal accounts that appear on a bank's balance sheet (Report of Condition)? The principal asset items on a bank's Report of Condition are loans, investments in marketable securities, cash, and miscellaneous assets. The principal liability items are deposits and nondeposit borrowings in the money market. Equity capital supplied by the stockholders rounds out the total sources of funds for a bank. 5-2. Which accounts are most important and which are least important on the asset side of a bank's balance sheet? The principal bank asset items from most important to least important are:: Rank Order Assets 1 Cash 2 Investment Securities 3 Loans 4 Miscellaneous Assets 5-3. What accounts are most important on the liability side of a balance sheet? The principal bank liability items from most important to least important are: Rank Order Liabilities and Equity Capital 1 Deposits 2 Nondeposit Borrowings 3 Equity Capital 4 Miscellaneous Liabilities 5-4. What are the essential differences among demand deposits, savings deposits, and time deposits?
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  • Fall '16
  • Thu Trang
  • Debt, Financial services, Mortgage loan, Deposit account

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