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    (CIN/A) : House Nor Invest in Non-Allied Enterprises

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    Ging Lim
    This document compares the characteristics of a universal bank and a commercial bank. A universal bank has the authority to act as a commercial bank, investment house, and invest in non-allied enterprises. It can invest up to 50% of its net worth in allied and non-allied enterprises, and up to 35% in a single non-allied enterprise. A commercial bank can only act as a commercial bank and has lower capitalization requirements. It can invest up to 50% of its net worth in allied enterprises, but cannot invest in non-allied enterprises.

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    (CIN/A) : House Nor Invest in Non-Allied Enterprises

    Uploaded by

    Ging Lim
    8 views3 pages
    This document compares the characteristics of a universal bank and a commercial bank. A universal bank has the authority to act as a commercial bank, investment house, and invest in non-allied enterprises. It can invest up to 50% of its net worth in allied and non-allied enterprises, and up to 35% in a single non-allied enterprise. A commercial bank can only act as a commercial bank and has lower capitalization requirements. It can invest up to 50% of its net worth in allied enterprises, but cannot invest in non-allied enterprises.

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    Oct 1_Banking Notes.docx

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    This document compares the characteristics of a universal bank and a commercial bank. A universal bank has the authority to act as a commercial bank, investment house, and invest in non-allied enterprises. It can invest up to 50% of its net worth in allied and non-allied enterprises, and up to 35% in a single non-allied enterprise. A commercial bank can only act as a commercial bank and has lower capitalization requirements. It can invest up to 50% of its net worth in allied enterprises, but cannot invest in non-allied enterprises.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    Download as docx, pdf, or txt
    8 views3 pages

    (CIN/A) : House Nor Invest in Non-Allied Enterprises

    Uploaded by

    Ging Lim
    This document compares the characteristics of a universal bank and a commercial bank. A universal bank has the authority to act as a commercial bank, investment house, and invest in non-allied enterprises. It can invest up to 50% of its net worth in allied and non-allied enterprises, and up to 35% in a single non-allied enterprise. A commercial bank can only act as a commercial bank and has lower capitalization requirements. It can invest up to 50% of its net worth in allied enterprises, but cannot invest in non-allied enterprises.

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    © All Rights Reserved
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    of 3

    Universal Bank

    Commercial Bank
    Has the authority to exercise the powers of (CIN/A)
    Ordinary banks governed by the GBL which have
    o a commercial bank
    lower capitalization requirement than universal banks
    Can exercise neither powers of an investment
    o an investment house
    house nor invest in non-allied enterprises
    o invest in non-allied enterprises
    have the highest capitalization
    primarily governed by the GBL
    Additional Powers
    NONE
    Additional powers other than those authorized for
    commercial banks (KB)
    Type of Investments
    Allied
    Allied
    o Financial
    o Financial
    o Non-financial
    o Non-financial
    Non-Allied
    Powers
    Authority to exercise the powers of
    General powers incident to corporations
    o a commercial bank
    Such powers necessary to carry on the business of
    o an investment house
    KB:
    o Accepting drafts and issuing LOC
    o invest in non-allied enterprises
    o Discounting and negotiating PN, drafts, BOE and
    other evidence of debt
    o Accepting or creating demand deposits, receiving
    other types of deposits and deposit substitutes
    o Buying and selling forex and other debt securities
    Extending credit
    Total Investments in Allied Enterprises

    Allied AND Non-allied: Not exceed 50% of net worth

    Not exceed 35% of net worth

    Total Investments in Non-Allied Enterprises

    Allied AND Non-allied: Not exceed 50% of net worth

    N/A

    Equity Investment in any 1 Enterprise

    Allied or Non-allied: Not exceed 25% of net worth

    Allied ONLY: Not exceed 25% of net worth

    Equity Investment in Financial Allied Enterprise


    Can own up to 100% equity in a thrift bank, rural
    May own up to 100% equity in a thrift bank or rural
    bank or a financial allied enterprise (liberal POV it
    bank
    should not be construed na isa lang)
    Other Financial Allied Enterprise: investment shall
    Publicly-listed UB or KB: May own up to 100% voting
    remain a minority holding
    stock of only one UB OR KB
    Publicly-listed UB or KB: May own up to 100% voting
    stock of only one UB OR KB
    Equity Investment in a Non-Financial Allied Enterprise

    May own up to 100% of the equity

    May own up to 100% of the equity

    Equity Investment in a Single Non-Allied Enterprise

    Not exceed 35% of the total equity or voting stock of


    that enterprise

    N/A

    Equity Investment in Quasi-Banks

    Limit of 40% equity investments of UB in quasibanks

    Limit of 40% equity investments of KB in quasi-banks

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