Introduction banking 2e casu

www.downloadslide.net Steven Ongena, Professor of Banking, University of Zurich, Swiss Finance Institute and CEPR I heartily endorse Introduction to Banking 2nd Edition, which thoroughly covers the topic of banking in the post-crisis world Unlike other textbooks which are very US-centric, this is a global banking book which covers issues and institutions on a worldwide basis This thoroughly revised edition of the book contains inestimable new chapters on banking crises, new financial instruments and a wide range of advanced issues The topics are examined with a distinguishing combination of analytical and practical approaches This makes the book an invaluable instrument for teaching banking to undergraduates both at universities and business schools I highly recommend it Elena Carletti, Professor of Finance, Bocconi University, IGIER and CEPR Introduction to Banking 2nd Edition offers a comprehensive insight into the business of banking, providing up-todate information about the impact of the financial crisis upon the banking sector globally and the far-reaching regulatory reforms Written by expert authors, this book covers both theoretical and applied issues relating to the global banking industry, highlighted by examples from across Europe and the wider international arena Organised into five main sections, this edition includes a brand new section – advanced topics in banking The new edition „„Familiarises students with the recent trends affecting the banking business „„Covers contemporary central banking and bank regulation issues comparing the UK, eurozone and the US, providing students with the most up-to-date information on banking practice „„Provides a strong focus on bank management issues and prepares students to understand the different financial features of commercial and investment banking business „„Outlines recent changes in developed and developing countries’ banking and financial systems, familiarising students with different types of banking systems and how global trends impact on different types of banking markets „„Covers advanced topics in banking, from the growth of the ‘shadow banking system’ to bank mergers and acquisition BANKING Allen N Berger, H Montague Osteen, Jr., Professor in Banking and Finance, Moore School of Business, and Carolina Distinguished Professor, University of South Carolina; Senior Fellow at Wharton Financial Institutions Center and Fellow of the European Banking Center, Tilburg University Introduction to I truly welcome this thoroughly revised edition of the Introduction to Banking textbook Its authors are world-class scholars who on a daily basis research a wide array of highly relevant banking topics and maintain many close contacts with the commercial and central banking community I can see no better guides to lead undergraduates into the fascinating (and at times bewildering) banking landscape Introduction to BANKING 2nd Edition Barbara Casu Claudia Girardone Philip Molyneux activities, and issues and challenges surrounding the industrial structure of modern banking markets Suitable for all undergraduate students taking a course in banking as well as professionals entering the banking industry It also provides solid background reading for postgraduate students who, in this updated edition, can benefit from three new chapters exploring more advanced topics in banking Barbara Casu is the Director of the Centre for Banking Research at Cass Business School, City University London, where she is Associate Professor of Banking Her research interests are in the area of banking, financial regulation, corporate governance and industrial organisation Barbara has published over 30 papers in international peer-reviewed journals, including The Review of Economics and Statistics and the Journal of Money, Credit and Banking 2nd Edition Casu Girardone Molyneux Claudia Girardone is Professor of Banking and Finance at the Essex Business School, University of Essex, UK Her current research focus is on banking sector performance and efficiency, bank corporate governance and the industrial structure of banking She has published widely in the banking and financial services area and is currently on the editorial board of several journals including the Journal of Banking & Finance and The European Journal of Finance Philip Molyneux is currently Professor of Banking and Finance and Dean of the College of Business, Law, Education and Social Science at Bangor University, North Wales, UK He has published widely in the banking and financial services area, including articles in the Journal of Banking & Finance, Review of Finance and European Economic Review CVR_CASU8130_02_SE_CVR.indd www.pearson-books.com Cover: © Rashevskyi Viacheslav/ Shutterstock 04/03/2015 11:53 www.downloadslide.net Introduction to Banking A01_CASU8130_02_SE_FM.indd 03/03/15 7:23 pm www.downloadslide.net A01_CASU8130_02_SE_FM.indd 03/03/15 7:23 pm www.downloadslide.net Second Edition Introduction to Banking Barbara Casu Cass Business School, City University London Claudia Girardone Essex Business School, University of Essex Philip Molyneux Bangor Business School, Bangor University iii A01_CASU8130_02_SE_FM.indd 03/03/15 7:23 pm www.downloadslide.net   Pearson Education Limited Edinburgh Gate Harlow CM20 2JE United Kingdom Tel: +44 (0)1279 623623 Web: www.pearson.com/uk First published 2006 (print and electronic) Second edition published 2015 (print and electronic) © Pearson Education Limited 2006, 2015 (print and electronic) The rights of Barbara Casu, Claudia Girardone and Philip Molyneux to be identified as authors of this work have been asserted by them in accordance with the Copyright, Designs and Patents Act 1988 The print publication is protected by copyright Prior to any prohibited reproduction, storage in a retrieval system, distribution or transmission in any form or by any means, electronic, mechanical, recording or otherwise, permission should be obtained from the publisher or, where applicable, a licence permitting restricted copying in the United Kingdom should be obtained from the Copyright Licensing Agency Ltd, Saffron House, 6–10 Kirby Street, London EC1N 8TS The ePublication is protected by copyright and must not be copied, reproduced, transferred, distributed, leased, licensed or publicly performed or used in any way except as specifically permitted in writing by the publishers, as allowed under the terms and conditions under which it was purchased, or as strictly permitted by applicable copyright law Any unauthorised distribution or use of this text may be a direct infringement of the author’s and the publishers’ rights and those responsible may be liable in law accordingly All trademarks used herein are the property of their respective owners The use of any trademark in this text does not vest in the author or publisher any trademark ownership rights in such trademarks, nor does the use of such trademarks imply any affiliation with or endorsement of this book by such owners Contains public sector information licensed under the Open Government Licence (OGL) v3.0 www.nationalarchives.gov.uk/doc/open-government-licence Pearson Education is not responsible for the content of third-party internet sites The Financial Times With a worldwide network of highly respected journalists, The Financial Times provides global business news, insightful opinion and expert analysis of business, finance and politics With over 500 journalists reporting from 50 countries worldwide, our in-depth coverage of international news is objectively reported and analysed from an independent, global perspective To find out more, visit www.ft.com/pearsonoffer ISBN: 978–0-273–71813–0 (print) 978–0-273–78064–9 (eText) 978-0-273-77656-7 (PDF) British Library Cataloguing-in-Publication Data A catalogue record for the print edition is available from the British Library Library of Congress Cataloging-in-Publication Data Casu, Barbara   Introduction to banking / Barbara Casu, Claudia Girardone, Philip Molyneux —Second edition     pages cm   ISBN 978-0-273-71813-0  1. Banks and banking—Europe.  2. Bank management—Europe. I Girardone, Claudia II Molyneux, Philip III Title  HG2974.C375 2015  332.1—dc23                                                             2014045195 10 19 18 17 16 15 Cover image: Rain from Golden Coins © Rashevskyi Viacheslav/Shutterstock Print edition typeset in Charter ITC Std 9.5/12.5 by 71 Print edition printed by Ashford Colour Press Ltd, Gosport NOTE THAT ANY PAGE CROSS REFERENCES REFER TO THE PRINT EDITION A01_CASU8130_02_SE_FM.indd 03/03/15 7:23 pm www.downloadslide.net   To Martin, Lila, Milan, Kika and Beth And to my parents and sister (BC) To Marc, Matteo and Leonardo To my parents Nieves and Sandro (CG) To Delyth, Alun, Catrin, Gareth, Gethin, Lois and Rhiannon (PM) A01_CASU8130_02_SE_FM.indd 03/03/15 7:23 pm www.downloadslide.net A01_CASU8130_02_SE_FM.indd 03/03/15 7:23 pm www.downloadslide.net Contents List of figures List of tables List of boxes Preface Acknowledgements List of abbreviations and acronyms xiii xvii xx xxiii xviii xxxv Part Introduction to banking What is special about banks? 1.1 1.2 1.3 1.4 1.5 1.6 1.7 Introduction The nature of financial intermediation The role of banks Information economies Why banks exist? Theories of financial intermediation The benefits of financial intermediation Conclusion Key terms Key reading Revision questions and problems Bank activities and services 2.1 2.2 2.3 2.4 2.5 2.6 Introduction What banks do? Banks and other financial institutions Banking services Sustainable and ethical banking: a brief overview Conclusion Key terms Key reading Revision questions and problems Types of banking 3.1 3.2 3.3 3.4 3.5 3.6 3.7 Introduction Traditional versus modern banking Retail or personal banking Private banking Corporate banking Investment banking Islamic banking 3 14 16 17 18 18 19 20 20 20 21 25 42 45 46 46 46 47 47 48 53 59 61 72 78 vii A01_CASU8130_02_SE_FM.indd 03/03/15 7:23 pm www.downloadslide.net Contents   3.8 Conclusion 81 81 82 82 Key terms Key reading Revision questions and problems   International banking   4.1    4.2    4.3    4.4    4.5    4.6   4.7 Introduction What is international banking? Brief history of international banking Why banks go overseas? Types of bank entry into foreign markets International banking services Conclusion Key terms Key reading Revision questions and problems Appendix 4.1 Syndicated lending: a selected glossary 83 83 83 86 87 94 99 112 113 114 114 115 Part 2  Central banking and bank regulation   Theory of central banking 121   5.1    5.2    5.3    5.4    5.5    5.6   5.7 121 122 123 127 145 149 151 Introduction What are the main functions of a central bank? How does monetary policy work? Monetary policy functions of a central bank Why banks need a central bank? Should central banks be independent? Conclusion Key terms Key reading Revision questions and problems 152 152 153   Central banks in practice 154   6.1    6.2    6.3    6.4   6.5 154 154 168 178 186 Introduction The Bank of England The European Central Bank (ECB) The Federal Reserve System Conclusion Key terms Key reading Revision questions and problems 187 188 188   Bank regulation and supervision 189   7.1    7.2    7.3    7.4 189 190 191 192 Introduction The rationale for regulation Types of regulation The financial safety net viii A01_CASU8130_02_SE_FM.indd 03/03/15 7:23 pm www.downloadslide.net Contents    7.5    7.6    7.7   7.8 Limitations of regulation Causes of regulatory reform Bank capital regulation Conclusion Key terms Key reading Revision questions and problems 202 205 206 225 225 225 226 Bank failures and banking crises 227   8.1    8.2    8.3   8.4   8.5   8.6 227 228 233 239 246 255 Introduction The determinants of bank failure Early warning systems for bank soundness Bank restructuring Banking crises Conclusion Key terms Key reading Revision questions and problems 255 255 256 Part 3  Issues in bank management   Banks’ balance sheet and income structure 259   9.1    9.2    9.3    9.4   9.5 259 260 274 279 294 Introduction Retail banks’ balance sheet structure Investment banks’ financial statements Bank performance and financial ratio analysis Conclusion Key terms Key reading Revision questions and problems 294 294 295 10 Bank financial management 296  10.1   10.2   10.3   10.4   10.5   10.6   10.7  10.8 296 297 302 303 303 307 310 327 Introduction Asset–liability management (ALM) Liquidity management and the importance of reserves Capital adequacy management Off-balance-sheet (OBS) business in banking Loan sales and the process of securitisation Derivative business in banking Conclusion Key terms Key reading Revision questions and problems 327 328 328 11 Banking risks 329  11.1 Introduction   11.2 Credit risk 329 329 ix A01_CASU8130_02_SE_FM.indd 03/03/15 7:23 pm www.downloadslide.net Index government bonds 9, 100, 142, 536, 548, 550, 672, 673–5, 706 market access indicator 556–7 open market operations (OMOs) 130–2, 714 government and growth of international banking 94 government safety net 202–3, 637–41, 662, 706 government and small firms 66–7 government-assisted mergers 242 government-sponsored enterprises (GSEs) 184, 492–3, 494, 520, 592, 594–5, 706 Fannie Mae see separate entry Freddie Mac see separate entry Gramm-Leach-Bliley Act 24, 48, 306, 491, 500, 517, 618, 634, 706 Greece 168, 170, 176, 250, 447, 460–1, 476, 608–9, 625, 638 concentration ratio 482, 695 cross-border banking 480 growth 569 profitability, bank 487 guarantees 70, 100, 253, 297, 305–6, 330, 346, 360, 706 deposit insurance see separate entry Euronotes 69, 701 letters of credit see separate entry H-statistic 653–5, 656, 659, 660–2, 666, 707 hedge funds 108, 128, 159, 205, 334, 343, 425, 491, 496, 506, 520, 521, 561, 592, 593, 609, 636, 706 hedging 71, 244, 286, 312, 313, 318–19, 334, 341, 590, 608, 706 herd instinct 93, 233 Herfindahl–Hirschman index (HHI) 645, 649, 650, 651, 660, 662, 707 high net worth individuals (HNWIs) 59–60, 277, 707 hire services/purchase 58–9, 64, 101–2, 707 historical cost accounting 311 Hong Kong 196, 199, 628 horizontal FDI 88, 707 HSBC 53, 61, 65, 79, 206, 357, 422, 432, 436, 481, 581, 592, 652 hubris hypothesis 632, 707 Hungary 246, 443, 479 Hypo Real Estate 404, 459 Iceland 228, 250–1, 443, 456, 473, 638 IKB Deutsche Industriebank 456 income statement 259, 265, 271–4, 276–9, 282, 286, 293, 303, 551 Bank of America 54–5 components of bank profits 429–30 fees and commissions 71, 75, 272 see also bank performance; financial ratio analysis Independent Commission on Banking 24, 47, 400, 411, 414–16, 437, 484, 636–7, 652, 707 India 36, 86, 196, 346, 555, 569, 577 indirect finance 5, 707 Indonesia 196, 218, 246, 248, 554–5, 569, 577, 585 inflation 123, 124, 126, 128, 140, 148, 168, 171, 173, 182, 185 Iceland 251 Japan 246 printing money 339 targeting 141–2, 149, 160–2, 166–7 inflation risk 348, 707 information 88, 89, 93, 149, 215, 358, 578, 584 customer 435, 436, 651 exchange 202 hard and soft information processing 633 memo 105–7 mergers 633 production 15, 17 sharing 457 information asymmetries 5, 8, 9–13, 190, 203, 305, 330, 366, 591, 631, 707 competition 644–5 liquidity risk and 337, 710 information technology see technology innovative (or new product) stage 91, 707 insolvency 227–8, 269, 302, 330, 338, 347, 349, 416, 524 bank restructuring 231, 239–46, 251, 691 determinants of bank failure 228–33 early warning systems see separate entry liquidity and solvency 146, 147, 148, 162–3, 190, 302, 337 measures of risk 663–4 and resolutions laws 198–202, 469–71 Z-score 558, 663, 666, 724 inspection 11, 707 institutional fund management 71 instruments of portfolio constraint 137–8, 707 insurance companies 10, 14, 21, 52, 108, 446–7, 499, 503–4, 535, 609, 634 monoline 458, 607–9, 610, 712 insurance services 9, 10, 37–8, 49, 53, 410, 426, 451, 519, 619, 708 bancassurance 9, 50–3, 618, 690 interbank lending 100, 147, 148–9, 175, 250, 261, 280, 297, 457, 459, 484, 486, 507–8, 510, 538–9, 575, 708 credit risk 360, 697 foreign exchange market 341 information asymmetries 337, 707 LIBOR 412, 709 liquidity gridlock 495 758 Z05_CASU8130_02_SE_IDX.indd 758 03/03/15 10:46 pm www.downloadslide.net Index liquidity risk 337, 338, 376, 377, 378, 710 settlement or payment risk 348, 719 Intercontinental Exchange (ICE) 412 interest on current accounts 436, 437 interest income 272 interest rate options 71 interest rate risk 71, 75, 332–6, 348–9, 708 managing 318–19, 323, 335, 369–76 interest rate swaps 71, 323–4, 325, 708 interest rates 10, 16, 17, 21, 35, 73, 100, 330 bonds, yields and 669–78 China 339, 574–5 competition 662 debt finance for small firms 63–4 EU: single market 453, 461 Euronotes 69, 701 foreign exchange risk 341, 705 Japan 543, 548, 551 mergers 633 Mexico 254 monetary policy 123, 128, 129, 131, 132, 133–5, 136, 142, 143, 144, 160, 171–3, 174, 184, 185, 186, 711 nominal and real 669 UK 404 US 87, 205, 333, 334–5, 593, 597 interest spreads 708 intermediation 3–18, 307, 590–3 international banking 83–113, 180, 183, 454, 517, 580 International Monetary Fund (IMF) 167, 174, 193, 197, 230, 234, 251, 460, 480, 545, 560, 568, 591 international risk assessment 388–95 internationalisation 197, 199, 205, 206, 327, 354, 446, 708 internet 36–7, 40, 62, 432, 574–5 intervened bank 240, 708 investment banking 47, 72–8, 97, 267, 276, 358, 454, 591, 708 commercial banks 53, 71, 74–5, 694 emerging markets 554, 561, 579, 700 European Union 24, 441, 446, 454, 618 financial statements 274–9 Japan 93, 531, 634 mergers 634, 636 proprietary trading 72, 73, 358, 716 remuneration 358 securities underwriting 71, 719 shadow banking 592, 719 talented employees 561 technology 48, 722 UK 48, 399, 410, 411, 414, 416, 419, 421, 426, 636, 637 US 24, 47, 73–8, 410, 492, 499, 500, 505–6, 513–14, 519, 523 investment products 37, 708 investments 263, 336 invoice discounting services 64, 101–2, 708 Iraq 581 Ireland 168, 170, 173, 250, 309, 447, 460–1, 474, 479, 558, 608–9, 638, 662 balance sheet structure 484, 487 concentration ratio 482, 695 cross-border banking 480 Islamic banking 78–80, 708 Italy 36, 48, 52, 57, 168, 170, 173, 208, 250, 442, 447, 479, 612 consolidation 476, 633, 634, 637 deposit insurance 196, 698 eurozone crisis 461, 609, 702 growth 569 loan sales 309, 710 Japan 24, 48, 60, 87, 92, 208, 306, 423, 527–53 Abenomics 547, 548–9, 689 bank-based financial system 13, 527, 546, 555, 591, 691 bank/company links 13 banking crisis 143, 233, 246, 364, 691 banking sector assets 474 deposit insurance 196, 698 foreign exchange trading 341 insurance market 503 mergers and acquisitions 579, 633, 711 peer-to-peer lending 36 quantitative easing 143, 716 regulation 528, 543, 546–7, 717 residential property prices 544 structure of banking system 528–38 universal banking 50, 618, 724 JPMorgan 285–6, 361, 500, 521, 581, 592, 627, 639 JPMorgan Chase 49, 74, 274, 412, 456, 495, 500, 506, 513, 521, 621 Kenya 31, 33, 580 key performance indicators (KPIs) 281–2, 708 King, Sir Mervyn 162, 166–8 Kosovo 443 Kuwait 581 Lamfalussy process 450, 451–2, 454, 708 large and complex financial institutions (LCFIs) or SIFIs 201, 223, 233, 243–6, 481, 499, 518, 522, 524, 592, 636, 709 Latin America 84, 86, 93, 313, 362, 554, 568, 577, 579, 580, 666 see also individual countries Latvia 168, 176, 443, 447 759 Z05_CASU8130_02_SE_IDX.indd 759 03/03/15 10:46 pm www.downloadslide.net Index leasing 6, 24, 59, 64, 101, 535, 709 least-cost resolution 196, 199, 241, 709 legal risk 348, 709 Lehman Brothers 73, 111, 150, 175, 184, 221, 244, 250, 267, 385, 404, 408, 456, 495, 506, 524 ‘lemon’ problem 10 lender of last resort (LOLR) 11, 122, 135, 145, 146–8, 191, 232, 302, 356, 561, 709 Bank of England 146, 162–5, 404, 405 Federal Reserve (Fed) 146, 163, 184, 703 international 197 Lerner index of monopoly power 657–8, 661, 662, 666, 709 letters of credit 68, 70, 86, 103, 104, 108, 297, 305, 346, 709 standby 70, 108, 306, 603, 721 leverage 76, 78, 167, 186, 216, 252, 269, 270–1, 331, 356, 523, 631, 635–6, 640, 709 Basel III ratio 222–3 capital risk 349, 693 deleveraging 309, 475, 488 European Union 474, 475, 488 United Kingdom 399 liabilities 8, 221, 253, 342, 370, 709 asset–liability management (ALM) 297–302, 354, 370, 376, 690 balance sheet 15, 20, 21, 260–1, 263–9, 276, 690 cash ratio deposits 137 central banks 129–30, 143–5 EU banking sector 484–7 financial 4, 16, 704 Japan: trust banks 532 management 230 mismatch 7, 335, 369 UK banking sector 422–6 US banking sector 499, 510 liability management 296, 377, 709 asset– (ALM) 297–302, 354, 370, 376, 690 LIBOR (London Interbank Offered Rate) 35, 69, 109, 110, 163, 290, 411–13, 709 Libya 568 Liikanen Report 24, 461, 474, 482–4, 709 limited-purpose finance companies (LPFCs) 592 liquid assets 15, 297, 337, 338, 376–7, 510, 547, 709 liquidation 241–2, 244, 330, 522, 523, 524 liquidity 5, 8, 15, 16, 252, 297, 309, 474, 492, 562, 709 Basel III 219–22, 408 central banks 126, 132, 134, 135, 136, 137, 142, 144, 146–8, 164, 165, 175, 176, 185, 191, 197, 253, 261, 402, 404 failure of RBS 406, 408 solvency and 146, 147, 148, 162–3, 190, 302, 337, 720 liquidity crises 337, 338, 504, 709 liquidity management 296, 300, 302, 520, 521, 710 liquidity risk 7, 336–9, 348–9, 710 managing 147, 376–8 Lithuania 176, 443, 649 Lloyds Banking Group 164, 168, 223, 404, 405, 406, 415–16, 419, 420, 422, 430, 432, 433, 437, 638, 652 Lloyds TSB 65, 79–80, 419, 420, 421, 436, 581 acquisition of HBOS 164, 404, 419, 433, 623, 631, 652 loan commitments 304–5, 710 loan policy 331, 710 loan rate 8, 363–4, 710 loan sales 306, 307–9, 710 loans 7, 8, 15, 17, 20, 35, 48, 75, 149, 254, 261–3 adverse selection 10, 689 bad see separate entry components of lending 307, 330 developing countries 138, 698 illiquid 190 impairment charges 408, 427, 428, 487 income statement 272, 286, 293 international banking 100 Japan 532, 548 managing lending function 362–9 MBBGs 425 mergers 633 mismatch 335 moral hazard 11, 712 non-performing see separate entry peer-to-peer (P2P) 36–7 process of deconstruction 306, 307, 716 short-term 68 SMEs 63–4, 66–7, 68 syndicated 70, 96, 101, 105–12, 115–17, 722 see also credit risk local banks 84–5 location advantages 91–2, 92, 710 London 87, 92, 205, 314, 357, 358, 421, 425 Stock Exchange 65, 102, 410 Long-Term Capital Management 128 long-term credit banks 533, 710 longer-term refinancing operations (LTROs) 144, 175, 710 Luxembourg 168, 170, 208, 442, 443, 447, 458, 459, 474, 479, 660 m-payments 31, 32–3, 40 Macau 568 Macedonia 443 760 Z05_CASU8130_02_SE_IDX.indd 760 03/03/15 10:46 pm www.downloadslide.net Index macro-hedging 313, 710 major British banking groups (MBBGs) 400, 419, 421, 425–6, 428, 429, 430–1, 710 Malaysia 246, 554–5, 579, 585 Malta 51, 168, 443, 447, 474 management and bank failure, poor 228–31, 232, 408, 459 management risk 348, 710 managerial capacity, excess 90 managerial motives 94, 632, 710 market flex language 109, 110, 710 market maker of last resort (MMOLR) 148, 163, 165, 710 market risk 71, 211–12, 213, 214, 223, 315, 342–4, 349, 711 CAMELS rating 235, 354, 692–3 credit risk and 361, 697 FTP framework 301–2 managing 378–84 rogue trader risk and 349, 350, 718 market segmentation 59, 677, 678, 711 market-based financial systems 555–6, 591, 710 market-based measures of bank risk 663–4, 710 market-to-book 284 mature product stage 91–2, 711 maturity transformation medium-term notes (MTNs) 70, 711 merger premium 637, 638, 711 mergers and acquisitions (M&As) 72, 75, 77, 616–42, 711 bank resolution 242 emerging markets 579–82, 700 EU 441, 482, 622–5 Japan 528, 533, 543 managerial motives 632, 710 UK 168, 417, 433, 434, 621, 627 US 492, 500, 621, 630, 632, 633, 634, 636, 637, 638 Merkel, Angela 640 Merrill Lynch 73, 74, 274, 410, 495, 506, 621, 631 Mexico 196, 249, 252, 253–4, 580 micro-hedging 313, 711 microfinance 31 Middle East 86, 111, 568, 577, 580–1 Mitsubishi UFJ 531, 533, 544, 548, 549 mobile phones 31, 32–3, 40, 539, 574–5 modern banking 47, 307, 354, 655, 711 international 86–7 traditional vs 48–53 monetary aggregates 125–6, 129, 160, 173–4, 182, 711 monetary financial institutions (MFIs) 21 monetary policy 21, 122, 123, 126–45, 149, 150, 170–7, 179–80, 181, 182–3, 337, 711 Fed: large-scale asset purchases 184–6 financial system and 560 Japan 547, 548 objectives 127–8, 149 rules vs discretion 140–2 UK inflation targeting 149, 160–2, 166–7 Monetary Policy Committee (MPC) 130, 142, 156, 160–2, 711 monetary transmission mechanism 139–40, 711 money 21, 124–6, 712 e- 24, 33–4, 39, 449, 465, 699 mobile 31, 32–3 money market funds (MMFs) 334, 476, 505, 506, 523, 524, 574–5, 605, 712 shadow banking 592, 593, 719 money markets 126, 133–4, 139, 144, 175, 179, 280, 297–8, 340, 589, 641, 712 see also interbank lending money transmission services 99, 435, 436, 437, 651, 712 Mongolia 568 monitoring 5, 7, 8, 10, 11, 12, 13, 186, 189, 191, 480, 611, 712 bank holding companies 74, 691 board of directors 357 competition 666 component of lending 307, 330 credit risk 332, 613, 697 delegated 14, 330, 698 financial firm behaviour see regulation moral hazard 590–1, 712 monoline insurers 458, 607–9, 610, 712 Monte Carlo simulations 375, 381, 382 Montenegro 443 moral hazard 10–11, 12, 167, 197, 202, 203, 252, 330, 411, 712 LOLR 146, 148, 163, 202, 203 monitoring 590–1, 712 regulatory forbearance 204, 232, 717 risk management processes 361 SIFIs 201 TBTF or TITF 202–3, 662 moral suasion 137 Morgan Stanley 73, 74, 75, 77–8, 274, 285, 410, 495, 505, 506, 513, 592, 627 mortgage brokers 592 mortgage equity withdrawal 364, 712 mortgage-backed securities (MBS) 78, 220, 310, 456, 494, 496, 507, 535, 544, 594–7, 598, 601, 604–5, 607, 609, 612, 712 central banks 163, 184, 404 Northern Rock 402, 404 761 Z05_CASU8130_02_SE_IDX.indd 761 03/03/15 10:46 pm www.downloadslide.net Index mortgages 9, 35, 37, 50, 51, 112, 263, 364–5, 368, 404, 410, 425, 426, 501, 593–7, 614 Dunfermline Building Society 405 EU: single market 454 finance and growth 561 Islamic 79 LIBOR contracts 412 Northern Rock 400 sub-prime crisis see separate entry multinational banking 84–5, 712 see also international banking multinational companies 67–72 mutual funds 499, 505, 506, 712 Myanmar 558 national consolidation 480, 712 national debt management policy 123, 712 nationalisation 163, 199, 247, 248, 250, 251, 358, 402, 404, 406, 504, 577 financial repression 573, 704 temporary public ownership (TPO) 243, 722 negative equity 364, 712 net interest margin (NIM) 284, 372, 551, 557, 712 Netherlands 31, 36, 57, 60, 168, 170, 196, 208, 357, 442, 447, 479, 612, 649 New Empirical Industrial Organization (NEIO) 653, 713 New York 92, 102, 358 New Zealand 136, 160, 167, 199 Nigeria 580 Nomura 254, 592 non-deposit-taking institution (NDTI) 21, 713 non-executive directors 357, 631, 632 non-performing loans (NPLs) 230–1, 246, 248, 251, 309, 356, 487, 488, 666, 713 building societies 368, 692 credit risk 332, 360, 697 Japan 143, 527, 528, 542, 543, 544, 551 non-performing mortgages 405 non-structural indicators 653–60, 713 Northern Ireland 437 Norway 246 note issuance facilities (NIF) 305, 713 Obama, Barack 496, 499, 612, 639, 640 Oceania 58 OECD (Organisation for Economic Co-operation and Development) 392, 393–4, 664 OFEX 66 off-balance sheet (OBS) management 230, 297, 303–7, 713 off-balance sheet (OBS) risk 215, 346–7, 348–9, 713 off-balance-sheet (OBS) activities 71–2, 205, 297, 310–11, 341, 361, 370, 376, 713 Office of the Comptroller of the Currency (OCC) 515–17, 521, 713 Office of Fair Trading (OFT) 38, 435, 652 Office of Federal Housing Enterprise Oversight (OFHEO) 493, 713 offshore banking 627, 714 ombudsman 38 ‘one-shop’ facility 37 open market operations (OMOs) 130–2, 136, 165, 171, 183, 714 operating risk 214, 348, 714 operational risk 346, 347, 348–9, 350, 383, 412, 634, 714 managing 384–8 opportunity costs 67, 302, 338 options 71, 321–3, 360–1, 649, 714 American and European 321 credit-spread put 313 over-collateralisation 601, 602, 604, 714 overdrafts 63, 68, 69, 100, 263 unused facility 297, 303, 305 ownership advantages 89–90, 714 Pakistan 346 Panzar-Rosse H-statistic 653–5, 656, 659, 660–2, 666 pay 355, 356, 357–8, 385, 404, 499, 522, 561 payment protection insurance (PPI) 38 payment or settlement risk 348 payment systems 25–34, 62–3, 149, 177–8, 180, 182, 714 Japan 538–42 UK 25–6, 431–3, 436, 437 US 507–9 peer group analysis 234, 280, 293, 714 peer-to-peer lending (P2P) 36–7 pension funds 21, 71, 108, 276, 499, 505, 506, 628 pension services 37–8, 426, 451, 519, 714 People’s Bank of China 338–9, 574 persistence of profits (POP) 659–60, 661, 662, 715 personal banking see retail banking Philippines 585 plastic cards 30, 31, 63, 432, 715 cheque guarantee cards 25, 30, 31 credit cards see separate entry debit cards see separate entry smart cards 31, 263, 539 store cards 432, 435 Poland 176, 246, 443, 479, 577, 580 political risk 98, 104, 580 portfolio constraint 137–8 762 Z05_CASU8130_02_SE_IDX.indd 762 03/03/15 10:46 pm www.downloadslide.net Index portfolio management (central banks) 149, 170, 177 portfolio risk 348, 715 portfolio theory 90, 368, 369, 679–88 Portugal 168, 170, 206, 250, 447, 460–1, 476, 479, 480, 608–9 growth 569 profitability, bank 487 pre-paid credit cards 30 present value (PV) 370, 620, 669–71 price elasticity of demand 654, 657, 715 price stability 121, 126, 128, 160–2, 168, 170, 172, 173, 181, 182, 186, 715 price to book value (P/B) 284 price to earnings (P/E) 558 price/dividend ratio 558 prices and incomes policy 123, 715 pricing in EU single market 454 pricing loans 363–4 syndicate loans 108–12 primary market 715 principal–agent problems 11–12, 13, 151, 251, 330, 715 private banking 59–61, 75, 93, 425, 570, 579, 580, 627–8, 629, 715 private equity finance 64–5, 108, 205, 425, 491, 496, 506, 520, 521, 561, 636, 715 privatisation 48, 252, 535–8, 577, 579, 716 process of deconstruction 306, 307, 716 product diffusion 92, 716 product life cycle 91–2, 716 profit and loss account see income statement profit margin 285, 716 profitability liquidity and 297, 338, 376, 709 profitability ratios see separate entry structure-conduct-performance (SCP) 645–52, 721 see also bank performance profitability ratios 282–6 cost–income ratio 61, 282, 284, 286, 427, 487, 558, 696 net interest margin (NIM) 284, 372, 551, 557, 712 return on assets see separate entry return on equity see separate entry proportionality 484 proprietary trading 72, 73, 358, 483, 484, 491, 496, 520, 521, 636, 716 prudential regulation 191, 716 public goods 149 public interest 199 purchase and assumption 243 Qatar 580–1, 628 quantitative easing (QE) 130, 133, 142–3, 184, 334, 335, 337, 405, 716 quiet life 632, 645, 665, 716 Rabobank 57, 412 rate-sensitive assets and liabilities 333–5, 370–2, 716 ratios see financial ratio analysis recapitalisation 164, 337, 405, 406, 458, 459, 460, 510, 520, 543, 582, 717 recession 247, 248, 364, 406, 444, 460, 498, 547, 579 refinancing risk 335, 717 regulation 11, 12, 21, 48, 50, 78, 189–225, 573, 612–14, 619, 627, 662, 717 bank performance 280–1 branch vs subsidiary 98 conglomerates 619 emerging markets 573, 577, 584, 700 EU 24, 238, 286, 448–54, 461–74, 475, 489, 613, 619 financial innovation 252, 703–4 foreign subsidiaries 205–6 key initiatives 244–6 limitations of 202–5 liquidity and solvency 147 structure-conduct-performance (SCP) 647, 721 UK 24, 48, 156–9, 261, 400, 409–16, 519, 570, 627, 636–7, 652 US see regulation in US see also Basel Committee on Banking Supervision; Basel I Accord; Basel II Accord; Basel III Accord regulation in US 48, 76–8, 183–4, 186, 205, 491–2, 515–24, 612–14, 636, 637–41 Dodd-Frank (Wall Street Reform and Consumer Protection) Act see separate entry Federal Deposit Insurance Corporation see separate entry stress testing 184, 235–6, 496, 498, 499, 721 regulatory dialectic 205 regulatory forbearance 203–4, 232, 717 regulatory risk 348, 388, 717 reinvestment risk 335–6, 717 relationship banking 13, 591, 633, 717 remote payments 40, 717 remuneration 355, 356, 357–8, 385, 404, 499, 522, 561 repos (repurchase agreements) 69, 100, 132, 163, 165, 263, 524, 593, 717 representative offices 95, 717 reputation risk 348, 388, 717 reserve requirements 87, 136–7, 171, 180, 183, 205, 573, 599, 663, 717 763 Z05_CASU8130_02_SE_IDX.indd 763 03/03/15 10:46 pm www.downloadslide.net Index retail banking 39, 53–9, 88, 93, 260–1, 475, 717 emerging markets 575, 700 EU 451, 453, 454, 652 Japan 532 managing lending function 362–9 ring-fencing 24, 47, 414, 416, 484, 636, 718 subsidiaries 97, 721 UK 410, 411, 414, 416, 420–1, 425–6, 427, 434, 435, 437, 484, 570, 636–7 US 492 return on assets (ROA) 282, 283, 284, 285, 292–3, 304, 558, 646, 649, 717 benchmarking 558 European Union 487 US commercial banks 510, 514 return on equity (ROE) 76, 282–3, 284, 285, 286, 289, 292–3, 303, 304, 353, 558, 646, 649, 717 Barclays 430 Basel III 218 benchmarking 558 European Union 487 Goldman Sachs 635 Lloyds Group 430 Royal Bank of Scotland 430 US commercial banks 510 rights issues 404 ring-fencing 24, 47, 414, 416, 484, 636, 718 risk 5, 7, 8, 16, 17, 50, 51, 204, 206, 232, 329–51 assessment 14, 212, 213, 214, 215, 239, 388–95 aversion 94, 106, 330, 331, 678 bank holding companies 74, 691 competition and 662–4 finance and growth 561, 562 M&As and diversification 634 portfolio theory 90, 368, 369, 679–88 risk culture 355–6, 718 risk management 71, 75, 216, 227, 251, 298, 352–95, 399, 520, 590, 718 derivatives 312–13, 318–19, 698 emerging markets 582, 700 exchange rate 319, 341 G-SIFIs 223, 619 interest rate 318–19, 323, 335, 369–76 liquidity 147, 376–8, 709 options 323, 714 retail banking 637, 717 risk measurement and 353, 718 stress testing 238, 239, 721 risk retention 613, 718 risk-adjusted return on capital (RAROC) 383–4, 718 risk–asset ratio (RAR) 209, 210–11, 718 rogue trader risk 349, 350, 718 rogue traders 228–9, 347, 718 Romania 176, 246, 443 Royal Bank of Scotland 163, 164, 167, 168, 230, 357, 358, 405, 406–8, 410, 412, 419, 421, 422, 430, 432–3, 436, 437, 457, 481, 592, 622, 630, 631, 638 Russia 60, 87, 196, 572, 577, 580 safety-net subsidies 202–3, 662, 718 systemic risk and exploitation of 637–41 Salomon Brothers 73 San Marino 558 Santander 206, 253–4, 404, 419, 432, 433, 457, 481, 622, 624–5, 630 Saudi Arabia 193 savings banks 56–7, 570, 619, 718 Sberbank 580 scenario analysis 383 Schumpeter, J 555 Scotland 437 screening 10, 11, 13, 590–1, 611, 613, 666, 718 securities 77, 263, 272, 302, 323, 426 gilt-edged see separate entry government bonds see separate entry investment banking 72, 73, 75, 275, 410, 708 portfolio theory 679–88 proprietary trading 72, 73, 358, 483, 484, 491, 496, 520, 521, 636, 716 securitisation see separate entry securities firms 76, 93, 410, 499, 506–7, 535 Securities Markets Programme (SMP) 144–5, 176, 719 securities underwriting 71, 75, 102, 205, 306, 500, 719 securitisation 6, 7, 13, 78, 112, 309–10, 361, 399, 400, 492, 493, 501, 523, 590, 719 credit-rating agencies, monoline insurers and 607–10 development of market 593–7 future of 611–14 Japan 544 modern process 598–604 ‘new wave’ of 604–6 shadow banking and 506–7, 592, 719 SMEs 66 types of 606–7 sensitivity analysis 343, 344 Serbia 160, 443 settlement or payment risk 348, 719 shadow banking 6–7, 252, 307, 399, 506–7, 523, 524, 561, 590, 592–3, 719 shareholders 12, 49–50, 64, 163, 242, 280, 353, 356, 457 diversification 635 764 Z05_CASU8130_02_SE_IDX.indd 764 03/03/15 10:46 pm www.downloadslide.net Index foreign ownership of banks 555, 570, 579–80, 584–5 remuneration 358 rights issues 404 shareholder value 93–4, 287–93, 300, 617, 629–32, 719 Shinkin banks 530, 531, 533–4, 547, 719 signalling 10, 591, 719 simulation approaches 373–6, 381, 382 Singapore 196, 341, 579, 628, 658 single EU passport 158, 410, 442, 446–7, 720 Single Rulebook 454, 463, 467, 472–4, 720 Slovakia 168, 246, 443, 447, 480, 487 Slovenia 168, 443, 447, 487, 572 small businesses 54, 88, 254, 404, 414, 416, 591 bank consolidation 633, 636 banking services used by 62–7, 68 P2P loans 36 savings banks 57, 718 Vickers Report 415–16, 724 small and medium-sized enterprises (SMEs) 62, 66–7, 215, 385, 510, 584, 720 bank consolidation 633 EU: single market 453 finance and growth 560, 561 Japan 143, 532, 533 state-owned banks 577, 578 UK 425, 435–7, 651, 652 smart cards 31, 263, 539 solvency 551, 562, 720 capital risk and 348–9, 693 liquidity and 146, 147, 148, 162–3, 190, 302, 337, 709 ratios 292–3 see also insolvency Somalia 32–3 South Africa 57, 86, 193, 580 South Korea 196, 246, 577, 579 sovereign debt crisis 250–1, 460 see also eurozone crisis sovereign risk 345–6, 389, 720 Soviet Union 572 Spain 48, 52, 57, 168, 170, 196, 250, 447, 476, 479, 579, 612, 638 deregulation 634, 698 eurozone crisis 461, 608–9, 702 financial depth 558 growth 569 loan sales 309, 710 Santander see separate entry Special Liquidity Scheme (SLS) 163, 404, 720 Special Resolution Regimes (SRRs) 198–9, 241, 244, 405, 720–1 specialist banks 47, 721 speculation 313, 323, 347, 496, 609 see also proprietary trading standardised products 92, 721 standby letters of credit 70, 108, 306, 603, 721 standing orders 25, 30, 62, 63, 721 state banking 576–9 store cards 432, 435 stress testing 177, 184, 237–9, 383, 384, 721 Basel III 222, 237 US 184, 235–6, 496, 498, 499 structure-conduct-performance (SCP) 645–52, 721 structured investment vehicles (SIVs) 592, 721 sub-prime crisis (2007–8) 37, 50, 378, 400, 456, 492–5, 544, 579, 594–7, 606, 609, 611 subsidiaries 96–8, 205–6, 721 Sudan 32 sudden stop 249, 721 supervision 189–90, 191, 252, 378, 619, 721 emerging markets 577, 584, 700 EU 450, 455, 457, 459, 461, 463–9, 484, 619 financial innovation 252, 703–4 liquidity and solvency 147 tripartite structure in UK 156, 402, 410 US 74, 180, 182, 183, 186, 499, 515, 517–18, 520 surplus units 4, 8, 14, 15, 16–17, 722 sustainable banking 42–5, 722 swaps 323, 360–1, 649, 722 credit default see separate entry currency see separate entry interest rate 71, 323–4, 325, 708 total-return 312–13 Sweden 161, 208, 246, 447, 479 SWIFT (Society for Worldwide Interbank Financial Telecommunication) 68 switching 415, 416, 435, 436, 437, 651 Switzerland 60, 85, 136, 196, 206, 208, 414 Swiss National Bank 496 syndicated loans 70, 96, 101, 105–12, 115–17, 722 systematic credit risk 332, 722 systemic regulation 191 systemic risk 24, 50, 162, 182, 186, 190, 204, 215, 227, 232, 247, 252, 329, 469, 722 Dodd–Frank Act 520, 522 exploitation of safety-net subsidies and 637–41 failure of RBS 406, 408 state-controlled banks 579 Vickers Commission 411 systemically important financial institutions (SIFIs) 201, 223, 233, 243–6, 481, 499, 518, 522, 524, 592, 636, 719 see also G-SIBs; G-SIFIs 765 Z05_CASU8130_02_SE_IDX.indd 765 03/03/15 10:46 pm www.downloadslide.net Index tail risk 384, 722 Taiwan 658 takeovers 94, 111, 280, 617, 620, 627, 631–2 see also mergers and acquisitions Tanzania 31 taxation 98, 123, 254, 293, 307, 331, 627 debt 309 EU 451, 453, 454, 473 Japan 548–9 technology 24, 40, 48, 77, 146, 297, 441, 475, 590, 616–17, 619, 722 costs 627 deregulation 574, 698 emerging markets 555, 573, 574, 700 RBS 432–3 risk 346 temporary public ownership (TPO) 243, 722 term loans 68, 108 Thailand 246, 249, 554–5, 577, 585 time inconsistency 141, 203 Tokyo 92 too big to fail (TBTF) 202–3, 223, 232–3, 253, 331, 356, 411, 434, 484, 519, 520, 524, 561, 582, 627, 632, 636, 637–41, 662, 722 trade barriers and banking 88, 94 trade credit 64, 254 trade finance 84, 103–4, 360, 414 trading book and banking book 343–4 trading risk see market risk traditional banking 277, 284, 723 modern vs 48–53 traditional foreign banking 83–4, 723 transaction costs 5–6, 8, 16, 17, 33, 148, 506, 723 CHAPS 63 peer-to-peer lending (P2P) 36 transactional banking 13, 723 transfer risk 84, 389 transition economies 554, 564, 565, 568, 572, 723 see also emerging markets Treasury 300–2, 358, 723 Treasury bills 163, 164, 165, 260, 261, 319, 333, 338, 404, 589, 592, 723 Treasury bonds 315–16 trust banks 532–3, 723 TSB 420, 421 Turkey 196, 218, 248, 443, 577, 580 Turner Review (2009) 399, 723 twin crises 250, 723 UBS 33, 229, 382, 383, 385, 410, 412, 592 UK Payments Administration Ltd (UKPA) 431 unit trusts 37, 723 United Arab Emirates 580–1 United Kingdom 13, 57–8, 85, 98, 138, 205, 208, 399–438, 474, 479, 481 Barclays see separate entry cheques 25–6, 29, 31, 63, 693 Co-operative Bank 57 colonial banking 86, 694 competition 410, 415–16, 426, 427, 433–7, 651–2 consumer loans 35 corporate banking 62–4, 65–6, 67, 695 credit cards 30 credit unions 58, 697 crisis in banking 2007–9 156, 246, 399–409, 419, 421–2, 425, 427, 434, 621 currency crises 249, 697 current accounts 35 Debt Management Office (DMO) 156, 165, 698 deposit insurance 195, 196, 250, 402, 404, 698 depth, financial 558 economic growth 568 equity finance for small firms 65–6 Euro 447, 700 factoring 101–2, 702 FCA see Financial Conduct Authority finance houses 58–9, 703 Financial Services Act 2012 156, 158, 400, 411, 431, 704 Financial Services Compensation Scheme 195, 199, 405, 416 foreign exchange trading 341 FSA see Financial Services Authority HBOS 163, 164, 168, 404, 419, 433, 623, 631, 652 housing market 364–5 Independent Commission on Banking 24, 47, 400, 411, 414–16, 437, 484, 636–7, 652, 707 insurance 37, 38, 51, 503 LIBOR see separate entry Lloyds Banking Group see separate entry loan sales 309, 710 London see separate entry M&As 168, 417, 433, 434, 621, 627 market-based financial system 555, 591, 710 mortgages 35 non-performing loans 231, 713 Northern Rock 163, 164, 167, 221, 400–4, 406, 419, 652 payment systems 25–6, 431–3, 436, 437, 714 peer-to-peer lending (P2P) 36–7 private sector purchasers 243, 715 regulation 24, 48, 156–9, 261, 400, 409–16, 519, 570, 627, 636–7, 652, 717 ring-fencing 24, 636, 718 766 Z05_CASU8130_02_SE_IDX.indd 766 03/03/15 10:46 pm www.downloadslide.net Index Royal Bank of Scotland see separate entry securitisation 309–10, 399, 612, 719 small firms 65–7 special resolution regime (SRR) 198–9, 405, 720–1 structure of banking sector 417–27 unit trusts 37, 723 Walker Review (2009) 357 United States 13, 60, 98, 112, 138, 160, 208, 292, 423, 491–525, 621, 630 accounting 311 bancassurance 53, 690 banking crisis 246, 492, 691 banking sector assets 474 CAMELS rating 234–5, 354, 692–3 certificates of deposit (CDs) 16, 693 commercial paper 69, 495, 694 competition and stability 665–6 corporate banking 67–8, 69, 695 credit cards 30, 92, 112 credit unions 58, 697 Dodd-Frank Act see separate entry economic growth 568 Federal Reserve (Fed) see separate entry foreign exchange trading 341 Gramm-Leach-Bliley Act see separate entry interest rates 87, 205, 333, 334–5 investment banking 24, 47, 73–8, 410, 492, 499, 500, 505–6, 513–14, 519, 523, 708 loan sales 309, 710 M&As 492, 500, 621, 630, 632, 633, 634, 636, 637, 638 market-based financial system 555, 591, 710 New York 92, 102, 358 non-performing loans 231, 713 overseas expansion 85, 86–7, 96–7 payment systems 507–9 peer-to-peer lending 36 regulation see regulation in US remuneration 357, 632 Savings and Loan Associations (S&Ls) 56, 246, 404, 503, 517, 593–4, 718 securitisation 112, 309–10, 492, 493, 593–614, 719 shadow banking 561, 592, 593, 719 stress testing 184, 235–6, 496, 498, 499, 721 structure of banking and financial systems 499–507 sub-prime crisis see separate entry syndicated loans 109, 722 Troubled Assets Relief Program (TARP) 74, 496–7, 498, 513, 723 universal banking 50, 724 venture capital 65, 724 Wall Street Crash 128 universal banks 24, 47, 48, 50–3, 71, 75, 410, 414, 446, 491, 501, 555, 590, 618, 627, 634, 635–6, 723 branches 97, 692 unsystematic credit risk 332, 724 Uruguay 580 VaR (value at risk) 286, 343, 380–3, 399, 724 venture capital 64–5, 724 vertical FDI 88, 724 Vickers/ICB Report 47, 400, 411, 414–16, 437, 484, 636–7, 652, 724 Vietnam 246, 555, 585 Volcker Rule 77, 78, 484, 491, 496, 520–2, 636, 724 Walker Review (2009) 357 Wall Street Crash 128 wealth 60, 124, 139 wholesale banking 57, 63, 67–8, 69, 72, 84, 87, 98, 100, 629, 724 balance sheet 261, 264, 277, 484, 690 Basel III 220, 221 central banks 126, 147 EU 441, 450, 454, 458, 460, 461, 484, 623 foreign exchange market 340, 341 income statement 276 Japan 535, 539, 542, 545 liquidity and solvency 147 risk management 378, 637, 718 UK 158, 399, 400, 406, 408, 411, 419, 437, 636–7 US 499–500, 507–9, 510 wholesale lockbox facilities 67 window-dressing 293 World Bank 193 World Trade Organization (WTO) 584 yield to maturity (YTM) 671–8 Z-score 558, 663, 666, 724 Zengin Data Telecommunication System 538, 724 Zopa 36 767 Z05_CASU8130_02_SE_IDX.indd 767 03/03/15 10:46 pm www.downloadslide.net Z05_CASU8130_02_SE_IDX.indd 768 03/03/15 10:46 pm www.downloadslide.net Z05_CASU8130_02_SE_IDX.indd 769 03/03/15 10:46 pm www.downloadslide.net Z05_CASU8130_02_SE_IDX.indd 770 03/03/15 10:46 pm www.downloadslide.net Z05_CASU8130_02_SE_IDX.indd 771 03/03/15 10:46 pm www.downloadslide.net Z05_CASU8130_02_SE_IDX.indd 772 03/03/15 10:46 pm ... problems Types of banking 3.1 3.2 3.3 3.4 3.5 3.6 3.7 Introduction Traditional versus modern banking Retail or personal banking Private banking Corporate banking Investment banking Islamic banking 3...www.downloadslide.net Introduction to Banking A01 _CASU8 130_02_SE_FM.indd 03/03/15 7:23 pm www.downloadslide.net A01 _CASU8 130_02_SE_FM.indd 03/03/15 7:23 pm www.downloadslide.net Second Edition Introduction to Banking. .. Cataloging-in-Publication Data Casu, Barbara  ? ?Introduction to banking / Barbara Casu, Claudia Girardone, Philip Molyneux —Second edition     pages cm   ISBN 978-0-273-71813-0  1. Banks and banking? ??Europe.