In your opinion, what is the effect of the banking sector clean up on investment decisions of individuals/firms.

Q: Do you think that removing the impediments to a nationwide banking system will be beneficial to the…

A: Nationwide banking system refers to the process of providing financial services to the customers of…

Q: Bank-based systems of financing non-financial companies are more effective than capital market-based…

A: Financial systems can help to keep domestic savings at home if they are well-governed. Financial…

Q: Explain what the "Avoids" are when developing Key Risk Indicators for commercial banks.?

A: The key risk indicators are the quantitative measures that are used by commercial banks to evaluate…

Q: What is the link between securitization and the economic function of financial intermediaries? What…

A: Introduction: Securitization combines diverse financial assets into a single instrument that is then…

Q: Distinguish between the activities of retail and investment banks and discuss how this has an impact…

A: Retail banks and investment banks serve distinct clients and fulfill different responsibilities.…

Q: Ways that banks compete for customers

A: Introduction: Banking is a highly competitive sector with virtually similar goods offered by all…

Q: Which of the following is not a reason for banks to be regulated? a.To protect depositors. b.To…

A: A bank is a type of financial institution that handles all procedures linked to depositing and…

Q: eign exchange risks and operational risks faced by banks operating in the financial sector, and…

A: Foreign Exchange Exposure refers to the risk associated with ever-changing foreign exchange rates…

Q: Why do managers of financial institutions care so much about the activities of the Central Bank?

A: The central bank has lots of powers to alter the incentives that are given to companies i.e.…

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: Who are the target customers of financial intermediaries like banks, investment banks, financial…

A: Financial intermediaries refers to the business entities that are the middlemen in the financial…

Q: do you think that the collaboration between Central Banks and Government creates challenges for…

A: If a country's economy were a human body, the central bank would be its heart. And, just as the…

Q: How would you describe the services provided by the investment advisory firms and portfolio…

A: Investment advisory firms and portfolio management companies are the important parts of investment…

Q: What is the relationship between securitization and the role of financial intermediaries in the…

A: Introduction: Financial markets are markets where the exchange of financial securities takes place.…

Q: Does its management typically have complete control over a firm’s credit policy? As a general…

A: SOLUTION:- Management does not have complete control over a firm's credit policy as credit policy is…

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: By giving clients with a variety of perks and advantages, as well as taking measures to keep them as…

A: Customer satisfaction: Customer satisfaction is the largest competitive advantage for banks. It…

Q: How does extence of rivalry among competitors in the banking sector affect the investment industry…

A: The global financial crisis rekindled policymakers' and academics' interest in bank competition and…

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: Explain monetary and fiscal measures that should be implemented by the government to cool down an…

A: Monetary policy means the management of the money supply and interest rates by central banks. To…

Q: In recent years, ‘direct lenders’ and ‘shadow banks’ have increasingly provided funding for…

A: The lending agencies are the financial institutions that provide funds to the public, business…

Q: Explain two types of financial risks faced by banks operating in the financial sector, and discuss…

A: Financial Risk: The danger of losing money on an investment or business endeavor is referred to as…

Q: A bank that grants loans to firms in a many different lines of business:  will increase its…

A: When a bank grants loans to firms in different lines of business then it has to incur more expenses…

Q: The financial markets play an important role in channeling funds from savers to borrowers. Which of…

A: Ans.(Option C) Investors deposit funds into interest-bearing accounts which are then loaned to…

Q: What roles are played by an investment bank and its brokeragefirm during an IPO?

A: Investment banks provide various types of services to its clients like underwriting services,…

Q: Why would the U.S. government consider reinstitutingthe “wall” between investment banking and…

A: A commercial bank is a financial institution which provides various financial services like…

Q: Based on the functions of the banking system, give reasons why governments bail out banks during an…

A: In the period of an economic crisis if the banks are creating vast losses and at risk of failure the…

Q: Distinguish between commercial and Investment banks.

A: Investment banks help companies manage their funds. They help these institutions to access capital,…

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: Which function of a financial intermediary reduces transaction and information costs between a…

A: Financial intermediaries help to make deals for their clients. Due to their professional skill set…

Q: What is the impact of capital controls that restrict mobility of capital across nationalborders on…

A: Capital controls are the controls that are implemented on the international movement of capital.…

Q: In order to earn money, how do financial institutions do it? What conditions restrict their ability…

A: Introduction: Financial markets are the exchanges on which financial assets and instruments are…

Q: Which of the following is NOT among key trends affecting the banking industry? O Convergence O ESG…

A: The banking industry is made up of a network of financial institutions called banks that help people…

Regulation of Commercial Banks

The main function of any commercial bank is accepting deposits and lending money to borrowers. Apart from these two activities, commercial banks provide a host of other services to their customers, like discounting bills of exchange, acting as a custodian of a customer's will, and so on. In the absence of a proper regulatory framework or proper regulations in place, the commercial banks would have ended up charging exorbitant or varied rates of interest or service charges on the funds loaned by them or the services performed by them.