paragraphes

 Navigate the internet and select one savings and loan association and one credit union based in the United States. Review their websites provide a brief description of each and summary of their services. 
The writing should be in your own words and no more than a page and a half. 
Convert to pdf and upload in portal. 

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CHAPTER 3
Depository Institutions
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Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall.
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Learning Objectives
What is a depository institution
What is the asset/liability problem faced by depository institutions
How does a depository institution generate income
What are the differences between commercial banks, savings and loan associations, savings banks, and credit unions

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall.

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall.
Commercial Banks
Bank Services
Individual banking
Institutional banking
Global banking
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Commercial Banks (continued)
Bank Funding
Deposits
Nondeposit borrowing
Common stock and retained earnings
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Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall.
Commercial Banks (continued)
Deposits
Demand deposits (checking accounts)
Time deposits (certificates of deposit)
Money market demand account (MMDA)
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Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall.

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall.
Commercial Banks (continued)
Nondeposit borrowing
Federal Reserve Bank
Discount window
Reserve Requirements
All 12 Federal Reserve Banks
Penalty for failure to satisfy reserve requirements

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Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall.

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall.
Savings and Loans Associations (continued)
Funding
Negotiable order of withdrawal (NOW) accounts
Money market deposit accounts (MMDA)
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Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall.
Savings Banks
Similar to S&L’s
Greater portfolio diversification
Corporate bonds
Treasury and government securities
Municipal securities
Common stock
Consumer loans
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Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall.

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall.
Savings Banks
Were able to handle funding risk better than S&L’s
Principal source of funds
deposits
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Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall.

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall.
Credit Unions
Smallest and youngest of the depository institutions
“Common bond” requirement for membership
Member owned
Member deposits are called shares
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Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall.

Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall.
Summary
Depository institutions raise funds, make loans and invest in securities
They seek to earnings through positive spread between assets and cost of funds
Basil Committee on Banking Supervision establishes risk and management guidelines for banks
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Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall.
Summary (continued)
Commercial banks may be classified as individual, institutional and global
The Federal Reserve Banks establish reserve requirements for banks
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Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall.