Q: HOW DOES INTEREST RATE AFFECT THE FINANCIAL MARKET AND FINANCIAL INSTITUTIONS
A: Interest rate is the rate of interest which is charged on borrowings in the economy.
Q: Using the macroeconomic environment of a bank explain the effect on margin. Provide an example of…
A: Margin is referred to as the type of deposit that an investor uses to place with their broker at the…
Q: Explain in detail the function played by the money market in the financial market.
A: Money market is a type of market which involves trading in short-term debt financial instruments.
Q: How is investment banking different from retail and corporate banking? Explain in a flowchart.
A: Retail Banking is the type of Banking which provides banking services or financial services to the…
Q: investment
A: Investment banks are is a type of financial institution who provide advisory based services…
Q: What is bank profitability? and market customer size and the concept of profitability? and…
A: Bank Profitability: Like all businesses, banks profit by earning extra money than what they pay in…
Q: Discuss three major financial risks that companies face today. credit risk, liquidity risk, and…
A: The three financial risk corporation faces today as follows: Credit risk: Credit risk is the risk of…
Q: Critically examine three important factors that threaten the liquidity risk management efficiency of…
A: Liquidity is the most important factor for contemporary banks because it requires more day to day…
Q: Examine 3 important factors that treathen the liquidity management efficiency of contemporary banks
A: It refers to the management which is concerned with the ideal use of the liquid assets such as cash…
Q: The financial performance of both Commercial Banks and Savings Banks is measured using the Net…
A: The net interest margin is referred as the net benefit of lending which derived from the lending and…
Q: Describe how financial intermediationand financial innovation affect bankingand the economy
A: Financial institutions refer to institutions that offer financial services in the financial market.…
Q: pros and cons of diversification in banking.
A: Introduction : The diversification of banking refers to the strategic diversification of banking…
Q: how do banks improve their net profit margin to increase Return on Equity?
A: Return on Equity (ROE) measures the company’s net income to the value of its total shareholders’…
Q: The business characteristics of the bank?How many kinds of capital mobilization,How to increase the…
A: Banks are the financial institution that lends money and accept deposit from the public. It helps…
Q: Explain the differen
A: Banks are the financial institutions of a county that provides loans, accept deposit from the public…
Q: Outline the main financial risks exposed by commercial banks and their implications on the value of…
A: The danger of losing money on an investment or business endeavor is referred to as financial risk.…
Q: Discuss the factors which led to the Credit Crunch.
A: A credit crunch refers to a decline in lending activity by financial institutions due to shortage of…
Q: Outline the factors which led to the Credit Crunch.
A: A credit crunch is a decrease in bank lending induced by an unexpected lack of funds. During…
Q: What are the ways in which a bank can increase its capital adequacy ratio?
A: Capital Adequacy Ratio or CAR is referred as the measure through the capital for the bank that are…
Q: In managing credit risk for banks what are the two main concerns that banks have when lending money?…
A: Credit risk: It is the risk involved in receiving the interest and principal payments from the…
Q: List the categories of central banks function? Elucidate the interbank markets?
A: Central bank of any economy (or country) is the apex financial institution that governs and…
Q: Explain commercial banks’ brokerage and intermediation functions. Clearly detail how these functions…
A: Commercial bank is defined as the place, where the individuals used to do banking. It makes the…
Q: ring and explain its advantages and disadvantages. Why might a bank be interested in a company’s…
A: Gearing : In simple words, gearing refers to the ratio of the company debt to equity. It depicts how…
Q: Explain how factoring works. Of what benefit is factoring to a firm that sells its receivables?
A: Lets first understand the meaning of factoring. Factoring is a selling the debtor to the factor at…
Q: Distinguish between illiquidity and insolvency for banks and discuss the role of capital in…
A: liquidity is considered as the short-term problem of banks where they are unable to make payments…
Q: What’s the difference between a commercial bank and an investment bank?
A: A financial institution that provides services such as accepting the deposits and providing the loan…
Q: What are the four key factors in a firm's credit policy? How would an easy policy differ from a…
A: Credit Policy of the firm is the Policy firm follows in extending credit to its customers. To…
Q: How do banks assess the risk appetite of each customers in terms of choosing the right investment
A: Investments of banks are in the form of loans they have provided. Before giving loan to any customer…
Q: What are the four key factors in a firm's credit policy? how would a relaxed policy differ from a…
A: Credit Policy relates to guidelines and terms of entity to facilitate credit sales that includes…
Q: Suppose that the central bank sells government bonds. Use a graph of the money market to show what…
A: If the central bank sells the government bonds then this kind of policy is stated as a…
Q: Three forms of market efficiency. Which form do you feel best describes today’s financial markets…
A: Market efficiency is the result of an efficient market theory which states that the prices of all…
Q: Why are loans such a high percentage of total assets at the typical bank? What four broad classes of…
A: The banking industry includes the banks and financial institutions that are providing loan…
Q: 2 Discuss driving force that would give Standard Bank a competitive edge in the market.
A: Competitive edge can be defined as a competitive advantage gained by a business organization over…
Q: Write methodology of impact of intellectual capital on the performance of SMEs/banks
A: Intellectual capital can be defined as the intangible assets which are very essential for the…
Q: Explain the difference between the primary and secondary markets. What roles do banks play in these…
A: capital market of the financial system rises capital from shares, bonds, and other investments to…
Q: What are the advantages and disadvantages of using financial leverage? Answer from the banker’s…
A: Financial leverage is a firm’s capability of borrowing so that the funds raised could be used to…
Q: To what extent does Money Market contribute to financial markets, and how
A: INTRODUCTION : Traders in financial instruments may participate in the market. It is possible to…
Q: (a) Distinguish between the activities of retail and investment banks and discuss how this has an…
A: An investment is an asset or item purchased for the purpose of generating an increase in income or…
Q: Explain market risk and discuss why banks are subject to this risk. Discuss how banks manage this…
A: If an investor invests money in a market there are different types of risk which an investor is…
Q: Explain the following concepts in relation to the role that banks play in financial markets: i)…
A: A bank is a financial institution that serves as a mediator between surplus units and deficit units,…
Discuss three ways in which banks use to make profit.
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- What is bank profitability? and market customer size and the concept of profitability? and profitability ratios?Given a financial institution that make money in three ways: interest income, interest income, and investment income, what are some ways a bank can capitalize off of non interest income. Give examples.Explain the difference between the primary and secondary markets. What roles do banks play in these markets?
- Briefly explain how banks manage credit risk and interest rate risk.define gross profit margin, net profit margin and operating profit margin ratios of bank proftability? please use in-text referencingExplain how commercial bank mange it balance sheet to maximize its profit without affecting the liquidity.
- Explain the following concepts in relation to the role that banks play in financial markets: i) Loan size transformation ii) Maturity transformation iii) Risk transformationwhat are the determinants of bank profitability ratios? please use in-text referencingAnswer the following questions: a. Find the profit of the investment b. Find share of the bank from the profit c. Find the weightage average in the three provided boxes d. Find the profit for each type of deposit e. Find the profit rate for each deposit