Main menu

Pages

Capital and bank deposits

 Bank deposits have taken a strategic position in the world of economics and money, and they have a strong relationship with capital, and there is a correlation between capital and its types and bank deposits and their types ..


Capital

The paid-up capital is less than the authorized capital.

Reserves are cash amounts deducted by commercial banks from: Net profits for distribution to shareholders.

As for the allocations, they are deducted from: Total profits at the end of the fiscal year.

To enforceable law.

Legal reserves: contained in the statute of the bank or in implementation

As for private reserves: they are taken up by banks in order to consolidate the financial position, and to enhance the bank's capital.

The provisions are amounts deducted from the gross profit at the end of the financial year to meet: doubtful debts, an expected decrease

In some securities, the change in the exchange rates of some major currencies and any emergency events and conditions.

Among the characteristics of undistributed profits: amounts that the bank intends to deduct from net profits, temporary in nature, calculated upon estimation

Financial resources available for investment and employment.

It is the capital, reserves, provisions and undistributed profits that constitute the self-resources of commercial banks.

The largest proportion of commercial banks' resources other than the founders or shareholders comes from deposits.

Current deposits mean: demand deposits.

The instrument used for demand deposits: the check.

One of the following types of deposits obligates a commercial bank to maintain a high percentage of cash reserves compared to other types of:

Deposits: deposits on demand.

Among the characteristics of time deposits: their depositors are not entitled to withdraw from them except after a certain period of time, including non-negotiable bonds.

Issued by the money market, including treasury bills whose maturity ranges between 1-5 years, interest paid on such as

These deposits.

With a fixed term.

Or partially

One of the characteristics of deposits with notification: The depositor's notification to the bank before withdrawal is completely distinguished

A savings deposit (saving) is called a certificate of deposit.

Forms of frozen funds include: Insurances for letters of guarantee, balances withheld or frozen by decisions issued

For a judicial body in favor of a public or private body.

Of the uses of commercial banks' resources: ready cash balances, discounted commercial and financial papers, assumptions and advances.

Where discounted commercial paper is represented by: treasury bills, bonds issued by the government, commercial papers for the commercial sector.

Treasury bills are short-term government bonds that are issued for a period of three months.

The promissory note: is the commercial paper of the first degree and has a high degree of guarantee.

As for the promissory note: a bond issued by the debtor, which can be traded by endorsement or subject to deduction and is easy to convert into liquid money.

Loans and advances are of short-term credit that is allocated to working capital, and financing current activity is allocated to two sectors

trade and Industry.

Advances: are defined as cash amounts recorded by banks in the debit envelope of the current account.

The most important loans and advances in developing countries: guaranteed by goods.

As for the guarantee in unsecured loans: financial position, solvency, good reputation and accuracy in fulfilling obligations.

, Less liquid, is like medium and long-term credit.

Characteristics of the stock portfolio: It makes a high profit

The primary function of commercial banks: accepting and receiving deposits, granting short-term credit, discounting commercial papers.

Commercial banks create derivative deposits based on the original deposits.

T1_n) / n Calculate the derivative deposit by the relationship: s = m)

If the total volume of deposits equals 200,000 then the statutory reserve ratio

S. The size of the initial deposit is 25 notes

%Equal :

Initial deposit size = total deposits x statutory reserve ratio

M = f x n

50,000 = 25% x 200,000 = M.

If an individual deposits a deposit with the economy’s only commercial bank of 24,000 the cash reserve ratio

L.S., a note

The statutory amount is 20%, the total deposit amount is:Total Deposit Volume = Initial Deposit / Statutory Reserve Ratio

F = m / n

120000 = 20% / 24000 = W.


bank deposits

The amount of derivative deposits is:
S = f_m
96000 = 120000_240000 = s
96000 =% 20 / (% 20_1) 24000 = n) / n_1) m = s
But when the commercial bank maintains an excess balances ratio of 10%, the total deposits amount:
F = m / n = 30/24000 = 80,000%
As for the amount of derivative deposits in the event of an excess balances ratio: S = F_M
56000 = 80000_24000 = s
S = m (1) _n + x)) / n + x
= 24000 (1_ (20% + 10%)) / (20% + 10%)) = 56000
The total deposit amount when the original deposit = 24000 and the actual reserve ratio = 30% and the leakage rate
Cash = 10% equal to:
F = m / np + v = 24,000% / 30 + 10 = 60,000%.
In the event of a cash leak, the amount of the derivative deposit equals:
Q = m (1) _nq + v)) / nv + v
36000 =% + 30% 10 / ((+ 30% + 10) _1) 24000 = s
The amount of loan size in the event of a cash leakage and an excess cash balance ratio:
K = m (1_np) / np + q =
24,000 (1_30%) / 10% + 30% = 42,000
If the derivative deposit multiplier is 4 then the statutory cash reserve ratio is equal to:
% 25 = 4 = n / 1 = m
Among the most important money creators: the Central Bank and the Public Treasury.
(Legal paper money in circulation) created by the Central Bank.
(Auxiliary money, deposits, and treasury bills) is created by the public treasury.
(Demand deposits, savings accounts, and time deposits) are created by the banking system.
The ability of banks to create credit is related to: the size of the initial original deposits and the statutory cash reserve ratio. It is connected
In a positive relationship.
As for the relationship between the ability of banks to create credit and the cash reserve ratio, it is an inverse relationship.
While the relationship between the size of the primary original deposits and the volume of the derivative deposits is a direct relationship.
Among the factors that commercial banks rely on in the process of creating credit: the size of the original initial deposits and the volume of deposits under
Demand, statutory cash reserve ratio, excess balances ratio, cash leakage ratio.
The ability of the bank to grant credit increases: if the size of the initial original deposit increases while other factors remain constant, and if it decreases
The ratio of the statutory cash reserve, and if the ratio of derivative deposits to loans granted by it increases.
Keynes: The first to use the credit multiplier index to indicate the impact of investment on national income.
The Central Bank's assistance to the public treasury consists of: direct advances by discounting guaranteed bonds, direct advances via
Deduction of unsecured bonds, direct advances by deducting the papers representing the loans provided by the depository fund.
Central Bank: you call it the source of the issuance.
His first job was to issue paper money.
The quality of the relationship between derivative deposits and cash leakage: a direct relationship.
The volume of loans granted by the bank is given in relation to:
K = m (1_n) / 1_q + nq
At the international conference held in Brussels in 1920: the decision was taken that every country should establish its own central bank.
At the beginning of the nineteenth century: the problem of paper money was raised at the global level.
Ricardo, the trading school, considered the banknote a simple substitute for gold, and the issuance bank with an equal mineral reserve.

For cash in circulation.
Completely

The Tok theory considered the paper banknote: as a credit instrument that increases the metal balance.
When decoupling the link between gold and the amount of paper money exported, and after Britain abandoning the gold standard in 1931:
Adoption of the mandatory rate.
The central bank issues legal notes. The reason for this is: Fear that governments may over-issue
Paper money to cover the budget deficit, fear of the deterioration of the value of paper money in circulation and lack of confidence, fear of deterioration
National economic activity.
Among the advantages of issuing in one institution: control over means of payment, including loans and credit, the public giving more
The trust and safety of the issued cash, limiting the excessive issuance of money and regulating the state’s relationship with the issuing entity, is a source of investigation
A great saving, ending the multiplicity of currencies in circulation, and here it goes back to the metal covenants, organizing trading within the community according to the needs of the activity
Economic, limiting precious metals to one side, limiting the impact of the amount of money issued on the internal and external balance
As a result of the state’s setting of its restrictions, the issuance is subject to the estimates of the monetary authorities.
In the following cases, the issuing bank in Britain used to issue paper money: Re-deducting previously discounted commercial paper
By deposit banks, following open market operations (buying and selling bonds in the financial market).
To make initial payments upon
For volume, become reserve
And a scale
One of the most important characteristics of the gold balance is that: It is no longer a bet
For war situations and strategic purposes.
Inability to provide liquidity from foreign exchange, considering it as a stock
Under the complete golden cover system, gold reserves that the central bank must keep when issuing money
Paper note: 100% of the issued banknotes.
Under the partial gold cap system, the issued currency is covered: 60% is a golden cap part, and the remaining part is 40%.
Characteristic of the partial issuance system: It involves issuing another amount of paper money covered by treasury bonds and bills
And commercial papers.
  maximum version system is called the maximum version system.
Among the characteristics of the free issuance system: the transfer of the balance from gold to an international cash reserve, which is used for making payments
By the contrast between the block
Foreign affairs, converting gold into reserves for contingencies, wars and strategies, the size of the issue became controlled
Cash and total goods and services available at current prices.
This refers to the credit control process carried out by the Central Bank: The bank controls the amount of written money created by the banks
Commercial.
Among the tools of indirect quantitative control of credit: the policy of rebate, the open market policy, the policy of adjustment
Legal cash reserve.
The economy follows a contractionary policy by increasing the re-discount rate and the interest rate if it is in an economic boom and there is a situation
From inflation and the central bank wanted to implement a policy of re-discounting, but in the stage of depression and recession it follows an expansionary policy through
Reducing the re-discount rate and the interest rate.
Among the characteristics of open market policy: it is implemented through the money markets, affects the size of the money mass in circulation, and affects interest rates
Prevailing in the economy.
If the economy is in an inflationary stage and the central bank wants to implement an open market policy, then it follows a deflationary policy by selling
Securities and their value seized by checks drawn on commercial banks.
If the central bank wants to implement an expansionary policy, it depends on: Increasing the legal reserve ratio imposed on
Banks, lowering the re-discount rate and interest rate.
If the Central Bank wants to implement a borrowing margin policy to avoid inflation, it will aim to: Raise the borrowing margin.
Among the tools of direct control (qualitative control) to direct credit: the borrowing margin, and the setting of upper limits for interest rates on
aCurrent deposits, oversight of the conditions of installment sale, the moral influence of the Central Bank on commercial banks.
reactions

Comments