Name: Doble, DannyBoy D. Yr.

& Section: BSBA-2B

Instructor's Name: Reyre Donguila Subject: FM

Lesson 3
BANKS AND OTHER FINANCIAL INSTITUTION
 ACTIVITY

Imagine you have your own company. Write a “slogan” for your company.

Jazz Liquors Inc.

" Chillin' like a villain while unstressing like a hero"

 ANALYSIS

Do you believe that the slogan you have in your company is important? Why?

Yes, I do believe that slogan I've got for my company is vital. it's important because it's one in
all the effective way to draw attention to the brand and therefore the product having a
particular slogan makes your brand different from others for a singular identity which lasts in
people's mind as an example "Finger-Lickin' Good" reminds everyone of KFC almost
instantaneously it also helps in brand positioning and recognition and also building a much
better customer relation by customizing brands slogan helps the customer to recall the brand
and also the product that successively eventually makes them develop a positive attitude
towards the brand

 APPLICATION

Task 1:

Discuss the following in your own words. (5 points each)

1. Explain financial intermediation?

Answer/s:

Financial intermediation is the process of accepting funds from one entity and lending or
investing these funds to another entity.

2. Differentiate the types of financial institutions and give examples.

Answer/s:
Depository Institution is financial institutions that accept deposits from individuals and then
offer to other individuals or small businesses.

Examples:

 Commercial Banks- BDO and BPI

 Thrift Institutions - CitiBank Savings
 Savings Bank - RCBC saving Bank
 Savings and Loan Association - ASLA savings and Loan Association Inc.
 Credit Unions - PCCC

Contractual Savings Organization-collects premium on insurance policies and

employees/employers' contributions and provides benefits and insurances against major
financial losses.

Examples:

 Insurance Companies - Manulife Insurance Company

 Pension Funds - Social Security System

Securities Firm-a a firm that facilitates financial market trades between buyers and sellers for a
fee.

Examples:

 Investment Companies - Pru Life UK-Financial Wellness

 Mutual Funds - Manulife
 Investment Banking Firm - BPI Capital Partners Inc.

Finance Firms- is an Organization that makes loans to individuals.

Examples:

 Finance Companies- Central Banks of the Philippines

 Mortgage Banking Firms- Uplifts Philippines Inc.

3. Explain the difference between commercial banks, investment banks, and universal banks.

Answer/s: A commercial bank accepts deposits, issues check-writing accounts to facilitate

making purchases and paying bills, and makes loans to individuals and businesses while an
investment bank helps businesses sell their new debt and equity securities to raise financial
capital. This is typically done by first purchasing the new securities issued by business
corporations and then reselling the shares to individual and institutional investors. The
universal bank is a bank that engages in both commercial banking and investment banking.

4. Differentiate commercial banking intermediation activities and investment banking

intermediation activities.
Answer/s: The main difference between investment banking and commercial banking is that
investment banking typically deals with purchasing and selling bonds and stocks for companies,
while commercial banks primarily accommodate deposits or loans for companies or individuals.
So, investment banks accommodate trading securities, whereas commercial banks don't.

5. Explain and give examples of unit banking, limited branch banking, and state-wide branch
banking.

Answer/s :

Unit Bank is a type of bank under which the banking operations are carried by a single branch
with a single office and they limit their operations to a limited area.

Example: Cantilan Bank

Branch banking allows a financial institution to expand its services outside of its home location
and into smaller storefronts that function as extensions of its greater operations.

Example: JPMorgan Chase & Co., Bank of America, Wells Fargo, or Citibank.

Statewide branch bank is banks that are allowed throughout a certain state.

Example: Bangko Sentral ng Pilipinas

6. Differentiate the different types of bank accounts.

Answer/s: Transaction account a checking or similar account from which transfers can be made
to third parties. Demand-deposit accounts, negotiable order of withdrawal NOW accounts,
automatic transfer service (ATS) accounts, and credit union share draft accounts are examples
of transaction accounts at banks and other depository institutions.

7. Differentiate bank liquidity from bank solvency.

Answer/s:

Solvency refers to an enterprise's capacity to meet its long-term financial commitments while
liquidity refers to an enterprise's ability to pay short-term obligations—the term also refers to a
company's capability to sell assets quickly to raise cash

8. Different asset management and liability management in the concept of banking

Answer/s

Asset management is the process of developing, operating, maintaining, and cost-effectively

selling assets while Liability management is the process of managing the use of assets and cash
flows to reduce the firm’s risk of loss from not paying a liability on time.