Financial Markets and Institutions (2-downloads)

PART SIX THE FINANCIAL INSTITUTIONS INDUSTRY

Chapter 17 Banking and the Management of Financial Institutions

398

Preview

398

The Bank Balance Sheet

399

Liabilities

399

Assets

401

Basic Banking

403

General Principles of Bank Management

405

Liquidity Management and the Role of Reserves

406

Asset Management

408

Liability Management

409

Capital Adequacy Management

410

■ THE PRACTICING MANAGER

Strategies for Managing Bank Capital

412

■ CASE

How a Capital Crunch Caused a Credit Crunch in 2008 

413

Off-Balance-Sheet Activities

414

Loan Sales

414

Generation of Fee Income

414

Trading Activities and Risk Management Techniques

415

■ CONFLICTS OF INTEREST

Barings, Daiwa, Sumitomo, and Societé Generale:

Rogue Traders and the Principal–Agent Problem

416

Measuring Bank Performance

417

Bank’s Income Statement

417

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Contents in Detail 

xxi

Measures of Bank Performance

419

Recent Trends in Bank Performance Measures

420

Summary

422

Key Terms

422

Questions

422

Quantitative Problems

423

Web Exercises

424

Chapter 18 Financial Regulation

425

Preview

425

Asymmetric Information and Financial Regulation

425

Government Safety Net

425

■ GLOBAL

The Spread of Government Deposit Insurance Throughout 

the World: Is This a Good Thing?

427

Restrictions on Asset Holdings

430

Capital Requirements

430

Prompt Corrective Action

431

■ GLOBAL

Whither the Basel Accord?

432

Financial Supervision: Chartering and Examination

433

Assessment of Risk Management

434

Disclosure Requirements

435

Consumer Protection

436

Restrictions on Competition

436

■ MINI-CASE

Mark-to-Market Accounting and the 2007–2009 Financial Crisis

437

■ MINI-CASE

The 2007–2009 Financial Crisis and Consumer Protection 

Regulation

438

Summary

438

■ E-FINANCE

Electronic Banking: New Challenges for Bank Regulation

439

■ GLOBAL

International Financial Regulation

440

The 1980s Savings and Loan and Banking Crisis

443

Federal Deposit Insurance Corporation Improvement Act of 1991

444

Banking Crises Throughout the World in Recent Years

445

“Déjà Vu All Over Again”

447

The Dodd-Frank Bill and Future Regulation

448

Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010

448

Future Regulation

449

Summary

451

Key Terms

451

Questions

451

Quantitative Problems

452

Web Exercises

453

Web Appendices

453

Chapter 19 Banking Industry: Structure and Competition

454

Preview

454

Historical Development of the Banking System

454