• Asset transformation • Selling liabilities with one set of characteristics and using the proceeds to buy assets with a different set of characteristics. • “Borrows short and lends long.”
Copyright © 2010 Pearson Addison-Wesley. All rights reserved.
10-8
浦发银行2011年资产负债表
资产 现金及存放中央银行款 项 存放同业和其它金融机 构款项 拆出资金 买入返售金融资产 发放贷款及垫款 可供出售金融资产 持有至到期投资 负债 同业和其它金融机构存 放款项 拆入资金 吸收存款 负债合计
Copyright © 2010 Pearson Addison-Wesley. All rights rpital • The difference between total assets and liabilities.(8%) • Raised by selling new stock or from retained earnings. • Is a cushion against a drop in the value of its assets.
Copyright © 2010 Pearson Addison-Wesley. All rights reserved.
10-7
• • • • •
4.Securities An important income-earning asset.(23%) Made up entirely of debt instruments. 5. Loan Banks make their profits primarily by issuing loans. (66%) • Typically less liquid and have a higher probability of default than other assets. • 5. Other assets • The physical capital owned by the banks.
Copyright © 2010 Pearson Addison-Wesley. All rights reserved.
10-5
9.1.2 Assets
• 1. Reserves • Reserves = Vault cash + Deposits in an account at the central bank ( required reserves + excess reserves) • No interest payment. • Banks hold reserves for two reasons: • 1) Reserve requirement • 2) Reserves are the most liquid and can be used to meet its obligations when funds are withdrawn. • 中国的历次调整
10-13
9.3.1 Liquidity Management
Reserve requirement = 10%, Excess reserves = $10 million Assets Liabilities Reserves $20 million Deposits $100 million Loans $80 million Bank Capital $ 10 million Securities $10 million Deposit outflow of $10 million Assets Liabilities Reserves $10 million Deposits $ 90 million Loans $80 million Bank Capital $ 10 million Securities $10 million With 10% reserve requirement, bank still has excess reserves of $1 million: no changes needed in balance sheet
Copyright © 2010 Pearson Addison-Wesley. All rights reserved.
366,957,099,000 267,876,482,000 111,415,298,000 281,509,782,000 1,302,323,950,000 147,929,131,000 158,535,453,000
Copyright © 2010 Pearson Addison-Wesley. All rights reserved.
10-10
T-account Analysis: Deposit of $100 cash into First National Bank Assets Liabilities Vault Cash + $100 (=Reserves) Checkable Deposits + $100
Copyright © 2010 Pearson Addison-Wesley. All rights reserved.
/focus/zhbj2 10-6
• 2. Cash items in process of collection • Suppose a check written on an account at another bank is deposited in your bank and the funds for this check have not yet been received from the other bank. • 3. Deposits at other banks • Many small banks hold deposits in larger banks in exchange for a variety of services. • All of the above three are referred to as cash items. Importance shrinking over time.
10-11
Basic Banking: Making a Profit
First National Bank Assets Required reserves Excess reserves Liabilities +$100 Checkable deposits +$90 +$100 First National Bank Assets Required reserves Loans Liabilities +$100 Checkable deposits +$90 +$100
Copyright © 2010 Pearson Addison-Wesley. All rights reserved.
10-12
9.3 General Principles of Bank Management 1. Liquidity Management
2. Asset Management
Checkable Checkable Reserves Deposits Reserves Deposits + $100 + $100 – $100 – $100 Conclusion: When bank receives deposits, reserves by equal amount; when bank loses deposits, reserves by amount Copyrightequal © 2010 Pearson Addison-Wesley. All rights reserved.
Copyright © 2010 Pearson Addison-Wesley. All rights reserved.
10-3
• 2. Nontransaction Deposit • Primary source of bank funds. • Owners cannot write checks, but the interest rates are usually higher. • Two types: • --Savings accounts • --Time deposit: have a fixed maturity length. • 3. Borrowings • More and more important.
Deposit of $100 check into First National Bank Assets Liabilities Cash items in process of collection + $100 First National Bank Assets Liabilities Checkable Deposits + $100 Second National Bank Assets Liabilities
14% 10% 4% 10% 49% 6% 6%
440,908,269,000 66,970,025,000 1,851,055,121,000 2,535,150,909,000 149,542,780,000
16% 2% 69% 94% 6%
10-9
所有者权益合计
9.2 Basic Banking
Copyright © 2010 Pearson Addison-Wesley. All rights reserved.
10-14
Liquidity Management