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Chu bien: Nguyen Ngoc Phuong Dung

Thanh vien:
Nguyen Quang Nhat
Nguyen Van Nguyen
PhanAnh
04.2021
Tai lieu Slr dung ne)i be)
BANKING UNIVERSITY - HOCHIMINH CITY
FACULTY OF FOREIGN LANGUAGES
Supplementary book:
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Nguyen Ngoc Phuong Dung

Nguyen Quang Nhat
Nguyen Van Nguyen
PhanAnh
April, 2021
For internal use
This book is designed to provide a supplementary practice material for undergraduate
students at Banking University Ho Chi Minh City majoring in Banking and Finance at the
intermediate level of English proficiency.
The book consists of three sections:
Section 1 includes topic-based practices covering four particular modules of financial
issues: Banking, Bonds, Stocks and Shares, and Financial statements. Each module
provides abundant exercises such as multiple choices of word definitions, vocabulary
matching, passage completion, reading comprehension, translation practice, and sentence
building.
Section 2 covers further exercises so that the students could use the terminology
appropriately in the contexts as well as apply the language skills developed throughout the
course to complete the tasks on vocabulary, passages, translation, and writing. These tasks
are selectively chosen from a wide range of materials to help course-takers consolidate the
language work covered in the textbook and successfully apply the knowledge in the exam.
Section 3 provides Suggested answers, References, Acknowledgements and Glossary.
SECTION 1: TOPIC- BASED PRACTICE EXERCISES
Module I 2
Module 2 9
Module 3 17
Module 4 26
SECTION 2: FURTHER PRACTICE

Vocabulary practice 36
Cloze passages 43
Reading comprehension 60
Translation 85
Writing 95
SECTION 3: ANSWERS- REFERENCES- ACKNOWLEDGEMENTS- GLOSSARY

Suggested answers 101
References 139
Acknow ledgements 141
Glossary 142
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PART 1: VOCABUlARY PRAcneE
1.1 Choose the best deftnltlon for each tenn.
1. Hedge fund
A. a fund involving a group of people who take high risks with their investments to
make a lot of money.
B. a fund to whom money is owed.
C. a fund operated by investment companies to put people's money in various assets.
D. a fund with invested money that will be paid to people after they retire from work.
2. Bankrupt
A. the money placed in a bank.
B. the status of not having enough money to continue the business.
C. all the profits in a business.
D. the income generated by an institutional investor.
3. Porfolio
A. a small plastic card you can use to buy something.
B. all the investments owned by an individual or organization.
C. an action to save someone from a dangerous or difficult situation.
D. an economic condition in which it suddenly becomes difficult and expensive to
borrow money.
4. Capital
A. a financial investment that is traded on the stock market.
B. the situation of withdrawing more money than depositing.
C. the action oflending money to somebody who might have difficulty paying it back.
D. a large amount of money that is invested in a business.
5. Conglomerate
A. a person or company that makes goods for sale.
B. a person or company that buys and sells investments for other people.
3
C. a large company formed by joining different smaller firms together.

D. the government department that controls public money.
1.2 Match these tenns wtth their corresponding meanings.

1 Stockbroker 2 Interest 3 Credit crunch
4 Overdraft 5 Transaction
A. a piece of business that is done between people, especially an act of buying or

selling. Transaction
B. the extra money that you pay when you borrow money or that you receive when
you invest money. Interest
C. a person or an organization that buys and sells shares for other people. Stockbrokers
D. An automatic loan for a current account holder when they need to spend over their
account balance. Overdraft
E. an economic condition in which it suddenly becomes difficult and expensive to

borrow money. Credit crunch
PART 2: CLOZE PASSAGES

2.1 Passage 1. Complete the passage wtth the words In the box.
money loan shareholders interest liabilities funds
capital certificates institutions back suppliers debt
When people want to set up or start a company, they need money, called (1)
capital
__ . Companies can borrow this money, called a (2) loan from banks. The loan
back with interest: the amount paid to borrow the (4) money . Capital
must be paid (3) __
certificates
can also come from issuing shares or equities - (5) representing units of
shareholders
ownership ofa company. The people who invest money in shares is known as (6) __
4
institutions
Individuals and financial (7) called investors can also lend money to companies
by buying bonds - loans that pay (8) interest and are paid at a fixed future date.
bank borrower investor repayments corporate customer
bond interest lender securitised dividend credit
A financial institution, such as a (1) bank , buys a loan from a (2) lender (such
as another bank), who has already lent an amount of money to a (3) borrower(another
person or institution). This means that the financial institution now has the right to
repayment
collect the (4) on the original borrowerD s loan. It then uses the expectation of
receiving these as security for a (5) bond which it issues to an individual or corporate
(6) investor in return for a specific amount of money, which the financial institution
promises to repay the investor at a later date. The financial institution also uses the
original borrower Ds repayments to make") interestpayments to the bond holder until the
date when the bond is repaid. Both the financial institution who bought the loan and (8)
securitised
__ it in the form of a bond, and the bank who originally sold the loan to the financial
institution, use the capital they have received from their sales to improve their financial
situation or increase their activities.
(Adapted/rom Market Leader Accounting and Finance)
PART 3: READING COMPREHENSION

3.1 Reading passage 1. Read the passage carefully and then brlefty answer
the following questions.
5
RAISING CAPITAL
Ruth Henly works in an investment bank in New York.
Unlike commercial banks, investment banks like ours don't lend money. Instead,
we act as intermediaries between companies and investors. We help companies and
governments raise capital by issuing securities such as stocks and bonds - that is, we
offer them for sale. We often underwrite securities issues: in other words, we guarantee
to buy the securities ourselves if we can't find other purchasers.
As well as initial public offerings (IPOs), when companies offer stock for sale
for the first time, there are other occasions when they raise funds. For example, they
might want to expand their operations, or to acquire another company, or to reduce their
amount of debt, or to finance a specific project. They don't only raise capital from the
public: they can sell stocks or shares to institutional investors like insurance companies,
investment funds - companies that invest the money of lots of small investors, and
pension funds - companies that invest money that will later be paid to retired workers.
We also have a stockbroking and dealing department. This executes orders - buys
and sells stocks for clients - which is broking, and trades with our own money, which is
dealing. The stockbroking department also offers advice to investors.
Questions:
1. What services are offered by an investment bank to the institutions?

Investment banks act as intermediaries between companies and investors.
2. What is IPO?
They raise capital by issuing securities such as stocks and bonds
3. Besides raising capital from the public, how can they raise funds?
They can sell stocks or shares to institutional investors
4. What does the stockbroking and dealing department do?

This executes orders - buys and sells stocks for clients - which is broking, and trades
with our own money, which is dealing. The stockbroking department also offers advice
to investors
6
3.2 Reading passage 2. Read the passage carefully and then briefty answer the
following questions.
CASH DISPENSERS
A bank opening an account for a customer undertakes to repay on demand.
Certain legal limitations have been placed on the repayment. It must be sought at the
branch where the account is, and during business hours.
The banks are closed at what the business community regards as an early hour.
Sometimes they have fixed their closing time at 3 p.m. and sometimes at 3.30 p.m. To
overcome part of the problem, most banks open some major branches on a Saturday
morning for limited personal services only. This extended service was pioneered by
Barclays Bank.
Another way to assist customers to obtain funds has been the introduction of cash
dispensers. There are different designs of this machine, but one of the earliest consisted
of a safe let into the outer wall of the bank and containing packets of £ lOin £ 1 notes.
The customer was issued with a cash card having punched holes, which was fed into the
machine for electronic checking. If this was satisfactory the customer was then given
access to a keyboard of ten numbered buttons on which he tapped out his personal code
number. The machine then delivered the £10 packet. It retained the cash card, which
initiated a debit to the customer's account and was then returned to him for further use.
Questions:
1. What are some limitations of bank payments?
Bank payment must be sought at the branch where the account is, and during business hours.
2. What did the Barclays Bank lead the way in?

The Barclays Bank led the way in opening some major branches on a Saturday morning for limited
personal services.
3. What did one of the earliest cash dispensers consist of?
One of the earliest cash dispensers consisted of a safe let into the outer wall of the bank and containing packets
of £ lOin £ 1 notes.
4. When could the customer gain access to the system?
When the cash card electronic checking was satisfactory.
7
PART 4: tRANSlATION
4.1 Translate the following sentences Into VletnaJllese.

1. Retail banks or commercial banks receive deposits from, and make loans to
individual and small companies.
Ngân hàng bán l hoc ngân hàng thng mi nhn tin gi, và cho vay ti các cá nhân và công ty nh
2. The rise in interest rate was only in some small-sized banks and did not reflect the
common trend of the entire banking system.
Vic tng lãi sut ch xy ra ti các ngân hàng có quy mô nh và không phn ánh c xu hng chung ca toàn h
thng ngân hàng.
3. Large banks became international conglomerates offering a complete range of

financial services that were previously provided by banks, hedge funds and insurance
companies.
Cac ngan hang Ion da tro thanh nhung tap doan da quoc gia cung cap mot he thong day du cac dich vu
tai chinh rna tnroc day da duoc thuc hien boi ngan hang, quy phong ho va cac cong ty bao hiem
4. With banks, consumers no longer need to keep large amounts of currency on hand;
transactions can be handled with cheques, debit cards or credit cards.
Doi voi cac ngan hang, khach hang khong con can giu mot khoang Ian tien m~t trong
tay; nhirng giao dich thay vao d6 c6 th~ thirc hien b&ngsec, the ghi no hoac the tin dung,
5. A financial institution is an establishment that conducts financial transactions such

as investments, loans and deposits.
T6 chirc tai chinh la mot co sa thirc hien cac giao dich tai chinh nhu la d~u tir, cho
vay va nhan tien giri,
4.2 VletnaJlle8e- EnlPlsh translation: Translate the following sentences Into

English.
1. Ngan hang d~u tu lam viec voi cac cong ty Ion, tu van tai chinh, va huy d9ng v6n
b&ng each phat hanh c6 phieu va trai phieu,
8
Investment banks work with big companies, giving financial advice, raising capital
by issuing stocks and bonds.
2. M9t s6 ngan hang ban le la cac t~p dean quoc t~ voi nhieu ngan hang chi nhanh tren
toan th~ gioi.
Some retail banks are international corporations with numerous
branch banks all over the world
3. Nho cong nghe, cluing ta co th~ mua sam t11Jctuyen, giao tiep t11Jctuyen, va tham
chi co th~ thirc hien ngan hang t11Jctuyen,
Thanks to technology, we can shop online, communicate
online, we can even do our banking online.
4. Sau khi tich liiy kinh nghiem lam viec trong ngan hang, nhieu ngiroi tham gia cac
khoa h9C v~ cac quy trinh trong ngan hang, cho yay, hoac d~u tu.
After gaining work experience in a bank, many people take staff
development courses in banking procedures, lending, or investing.
5. M9t tai khoan chung/lien danh duoc coi la rui ro han hai tai khoan rieng biet, nhirng
nhieu ngiroi nhan th~y r&ngviec g9P thu nhap vao mot tai khoan chung giup thanh
toan hoa dan d~ dang han.
A joint account is considered to be riskier than two separate accounts, but many
people find that pooling income into a common account makes bill paying easier.
PART 5: WRITING
Make meaningful sentences by adding between 8 and 15 words to the given
phrases.
1. Subprime borrowers are those with poor credit ratings and consequently a high risk
. of default
2. Securitization means pooling financial assets like morgages and converting into. securities.
3. When many subprime borrowers stopped paying, the value of subprime related
. securities fell
dramatically.
4. The credit crunch happens when there is a massive reduction in the credit available. for
banks to lend to other banks, and businesses.
5. Non- bank financial intermediaries also offer products like personal loans,
. credit cards
and insurance.
9

1. Cash flows
A. the part ownership of a company in the form of stocks or shares.
B. the price at which a market-maker or dealer is prepared to buy securities or other
assets.
C. a thing that is borrowed, especially a sum of money that is expected to be paid
back with interest.
D. the money a company receives and spends during a certain period.
2. Equity
A. the people or institutions to whom money is owned.
B. businesses that buy and sell securities.
C. the rate of income that an investor receives from a security.
D. the part ownership of a company in the form of stock or shares.
3. Principal
A. the compensation paid for the use of money, usually expressed as an annual
percentage.
B. the amount of capital making the company in the form of bonds or other loans.
C. the total amount of money being transferred into and out of a business.
D. the money that a company borrows in order to do business or finance its activities.
4. Coupon
A. the rate of income an investor receives from a security.
B. the payments by companies to their shareholders.
C. the amount of interest that a bond pays.
D. an improvement or increase in prices.
10
5. Maturity
A. a situation in which prices or interest rates go up and down suddenly.
B. the length of time for which a bond is issued until it is repaid.
C. the process of a company expanding or varying its range of products.
D. the date on which a security was issued.
1.2 Match these tenns with their corresponding meanings.

1 IOU 2 Yield 3 Speculator
4 Market maker 5 Insolvent
A. a person who buys and sell goods, property, currency or shares in a company in
the hope of making a quick profit
B. a document showing how much money you owe to someone
C. the rate of income an investor receives from a security
D. unable to pay debts
E. a business that buys and sells securities

2.1 Passage 1. Complete the passage with the words in the box.
raise repay maturity default yield withdraw
taxable bond debt issued ownership treasury
Corporate bonds (also called corporates) are (1) debt

__ obligations, or IOU s (I
owe you), issued by private and public corporations. They are typically (2) issued III
multiples of$l,OOO and/or $5,000. Companies use the funds they (3) raise from selling
11
bonds for a variety of purposes, from building facilities to purchasing equipment to

expanding their business.
When you buy a (4) bond , you are lending money to the corporation that issued it. The
corporation promises to (5) repay your money (also called principal) on a specified (6)
maturity
__ date. Until that time, it also pays you a stated rate of interest, usually semiannually.
The interest payments you receive from corporate bonds are (7) taxable
__ . Unlike stocks,
bonds do not give you a(n) (8) __ interest in the issuing corporation.
ownership
2.2 Passage 2. Complete the passage with the words In the box.
payments reserves liquidation dividend revives operation
bankruptcy cash flow profits distribution bondholders contribution
There are also risks and disadvantages associated with debt finance. In the event
bankruptcy
of a corporate (1) , a companyD s assets are at risk of being taken over by its largest
bondholders payments
(2) if it misses any scheduled interest or principal (3) . For instance, if a
company does not comply with the terms of the loan that was issued as a part of debt
liquidation
finance, bondholders can trigger a (4) of the companyDs assets in order to be paid.
A company that is active in debt finance should exhibit discipline with its cash (5) reserves
__
profits over the period of the loans. There is less
and also must outline anticipated (6) __
cash flow
flexibility with future (7) for a company active in debt finance versus equity
dividend
financing because of the payment (8) obligations.

3.1 Reading passage 1. Read the passage carefully and then brlefty answer the
12
WHAT ARE THE DIFFERENT TYPES OF BONDS?
There are an almost endless variety of bond types. In the U.S., investment-grade
bonds can be broadly classified into four types - corporate, government, agency and
municipal bonds - depending on the entity that issues them. These four bond types also
feature differing tax treatments, which is a key consideration for bond investors.
Corporate bonds
Corporate bonds are issued by public and private companies to fund day-to-day
operations, expand production, fund research or to finance acquisitions. Corporate
bonds are subject to federal and state income taxes.
Government bonds
U.S. government bonds are issued by the federal government. They are
commonly known as treasuries, because they are issued by the U.S. Treasury
Department. Money raised from the sale of treasuries funds every aspect of government
activity. They are subject to federal tax but exempt from state and local taxes.
Agency bonds
Government Sponsored Enterprise (GSE) like Fannie Mae and Freddie
Mac issue agency bonds to provide funding for the federal mortgage, education and
agricultural lending programs. These bonds are subject to federal tax, but some are
exempt from state and local taxes.
Municipal bonds
States, cities and countries issue municipal bonds to fund local projects. Interest
earned on municipal bonds is tax-free at the federal level and often at the state level as
well, making them an attractive investment for high-net-worth investors and those
seeking tax-free income during retirement.
Questions
1. What are two differences of bond types mentioned in the passage?
4 types.
13
2. What institutions issue treasuries?

The federal government.
3. What does GSE represent?

Government Sponsored Enterprise.
4. Why are GSEs issued?

to provide funding for the federal mortgage, education and agricultural lending programs.
3.2 Reading passage 2. Read the passage carefully and then brlefty answer the
UNDERSTANDING HEDGE FUNDS

Hedge funds are private investment funds which are only open to a limited range
of investors, the number of which is determined by its regulators, but is restricted by law
to no more than 100 investors per fund. They are special in that they are exempt from
many of the rules and regulations governing other mutual funds, and this allows them to
undertake a wider range of trading activities and employ more aggressive strategies than
are normally permitted. As a consequence of the restricted number of investors, most
hedge funds set an extremely high minimum investment amount, ranging from $250,000
to as much as $1 million. Investors also have to pay an annual performance fee to the
investment manager, as is standard practice for mutual funds; however, hedge funds also
collect a percentage of the profits (usually 20 %).
The underlying philosophy of hedge funds which originated on Wall Street in the
1940s as an investment option for the extremely wealthy is wealth preservation. They
operate on the principle of absolute return of making money on an ongoing basis,
regardless of market fluctuations. This is an attractive proposition for investors and
hedge fund activity has increased greatly over the last 15 years.
Questions
14
1. Who decides the number of investors of a hedge fund?

Regulators.
2. What is the principal characteristic that distinguishes hedge funds from other types of
mutual fund?
Hedge funds are less regulated and can engage in a broader range of trading activities
3. Why does the minimum investment for a hedge fund tend to be high?
The number of investors is restricted.
4. What does the principle of 'absolute return' entail?

Always making a profit whether the markets move up or down.
PART 4: TRANSlATION
4.1 EnlPlsh - Vietnamese translation: Translate the following sentences Into
Vietnamese.
1. If they need to raise more money to expand their operations, they can either issue
new shares - or borrow money, usually by issuing bonds.
Neu ho can huy dong nhieu tien hon de mo rong hoat dong cua minh, ho co the phat
hanh co phieu moi hoac bang cach muon tien, thong thuong bang viec phat hanh trai
phieu,
2. For investors, bonds are generally safer than stocks or shares, because ifan insolvent
or bankrupt company sells its assets, bondholders are among the creditors who might
get some of their money back.
Doi voi cac nha dau tu, trai phieu noi chung thuong an toan hon co phieu, boi vì neu
mot cong ty vo no hay pha san phai ban tai san cua no, trai chu la 1 trong nhung chu
no co the lay li mot phan tien cua ho
3. If tax revenue is insufficient, governments also issue bonds to raise money, and these
are considered to be a risk-free investment.
Neu khoan thu tu thue thu nhap khong du, chinh phu cung phat hanh trai phieu de
huy dong von, va dieu nay duoc xem la su dau tu khong rui ro
15
4. Only brave hearts would look at getting back into the stock market at the moment,
as it is still unclear whether we are headed for a worldwide recession or depression.
Chi nhung trai tim dung cam moi nhin nhan viec quay tro lai thi truong chung khoan vao
luc nay, boi vi van khong ro rang rang lieu chung ta co the doi dau voi mot cuoc khung
hoang hay suy thoai toan cau nua hay khong
5. This fund aims to achieve a high and steady income and above average yield, while
taking into account the security of capital.
Quy nay huong toi viec dat duoc thu nhap cao va on dinh va o tren muc hoa loi trung
binh, trong khi van quan tam den viec an toan cua nguon von dau tu.
4.2 VletnaJlle8e - EnlPlsh translafton: Translate the following sentences Into

EnlPlsh.
1. Trai phieu chinh phil duoc xem nhu la khong c6 rui ro va thuong duoc giao dich (1
thi tnrong c6 tinh thanh khoan cao.

Government bonds are considered risk-free and are traded in highly liquid markets.
2. M9t s6 trai phieu chinh phil gioi han s6 hrong d6ng do la c6 th~ duoc mua trong m6i
mot nam dirong lich.
Certain government bonds restrict the dollar amount that may be purchased per
calendar year
3. Trai phieu doanh nghiep cho phep cong ty vay tien t11Jctiep til cac nha d~u tu ca
nhan va t6 chirc d~u tu.
Corporate bonds allow the company to borrow money directly from individual and
institutional investors.
16
4. Til quan diem cua cac nha phat hanh trai phieu, trai phieu thinh thoang t6t hon c6
phieu boi vi Eii su~t tra cho trai chu duoc kh~u tnr thue,
From the issuers' point of view, bonds are sometimes better than shares as the
interests paid to the bondholders are tax deductible.
5. Trai phieu c6 Eii su~t cao d~ thu hut cac nha d~u tu. Tuy nhien cac nha d~u tu than
trong c6 th~ t:;10ra mot nguon thu kha kha til 10:;1itrai phieu nay.
The high-yield bonds offer attractive rates to lure investors. However, the investors
who choose carefully can earn quite decent money from these
PART 5: WRITING
words. their original investment on a fixed maturity date and receive
1. Bond holders can get back interest payments at regular intervals.
.
2. A company that wants to raise cash can .
3. The Primary Market is securities exchange where
. new securities are issued to the shareholders.
4. If a company goes bankrupt, bondholders can

. get some of their money back.
5. The yield of a bond depends on. its purchase price as well as its coupon.
17
MVVUL~J:§TVC~§4NV§~~~
1. Index
A. a sign or number that shows how something is changing or performing.
B. a share of the value of a company which can be bought, sold, or traded as an
investment.
C. a list of the financial institutions.
D. a certificate representing part ownership of the company.
2. Recession
A. a market in which share prices are rising.
B. a period of time in which there is a decrease in economic activities and many
people do not have jobs.
C. a period during which prices in a financial market are going down and a lot of
people are selling shares.
D. a situation in which a company offers shares for sale on a stock market for the
first time.
3. Underwrite
A. falling suddenly straight down especially from a very high place.
B. using money to earn more money.
C. making someone strong, healthy, or active again.
D. giving money to support something, such as a new business, and agree to be
responsible for any losses if it fails.
4. Bailout
A. the returns that an asset achieves over a certain period of time.
B. the possibility that something bad or unpleasant will happen.
C. the act of rescuing something (such as a business) from financial problems.
D. the aggregation of buyers and sellers of stocks.
18
5. Bear market
A. the quality in a situation of being likely to change suddenly.
B. a period of time in which there is a decrease in economic activity and many
people do not have jobs.
C. a period when the economy of a country is not successful and conditions for
business are bad.
D. a condition in which securities prices fall.

1 Blue chip 2 Flotation 3 Derivative
4 Nominal value 5 Bull market
A. a market in which share prices are increasing, encouraging more investors.

B. stock in a corporation with a national reputation for quality, reliability, and the
ability to operate profitably in good times and bad.
C. the price of a share, bond, or security when it was issued, rather than its current
market value.
D. a situation in which a company offers shares for sale on a stock market for the
first time.
E. an arrangement or product (such as a future, option, or warrant) whose value
derives from and is dependent on the value of an underlying asset, such as a
commodity, currency, or security.
2.1 Passage 1. Complete the passage with the words in the box.
19
corporation public limited private creditor liquidation underwrite
company company
certificates stocks shares investment flotation primary
market
Successful companies can issue (1) __ (B.E.) or (2) (A.E.), which are
(3) representing part ownership of a company, to raise capital to expand their
operations. If these shares are offered for sale to financial institutions and the general
public, this operation is called going public, and the business will change from a private
company to a public company (called a (4) __ or PLC in Britain and a (5) in
the US).
Offering shares to outside investors is generally called a (6) __ in Britain, and
an IPO or initial public offering in the US. Companies usually get advice from an
investment bank about how many shares to offer and at what price. The (7) bank
helps to find buyers, and will probably (8) __ the share issue, meaning that it
guarantees to buy the shares if there are not enough other buyers/purchasers.
2•2 Passage
'-e' 2 • Complete the passage with the words In the box•
due diligence equity debt shareholders common ordinary
report financing financing stock shares
bonds prospectus corporation liabilities secondary exchange
The company will commission a (1) : a detailed examination of its financial
situation from an auditing firm, and then issue a (2) __ explaining its financial
position, and giving details about the senior managers and the financial results from
previous years.
20
Shares are also known as equity or equities. (3) __ is not the same as (4)
__ (borrowing money) as money raised from equities never needs to be paid back;
instead, the holder owns part of the business.
The most common forms of equities are called (5) in Britain and (6) in the
US. (In Britain, stock means securities such as government (7) ) The people who
buy equities are called (8) --
PART 3. READING COMPREHENSION

3.1 Reading passage 1: Read the passage carefully and brlefty answer the
WHY STOCK MARKET MATTERS FOR YOU
Stefan Armbruster, BBe News online

The saying goes: 'DonOt invest what you canOt afford to lose.
But as stock markets fall, it is not just people who own shares who lose out. When
the bears replace the bulls - in other words, when the market falls - it affects almost
everyone because stocks and shares have become an integral part of almost all our
financial lives.
There are a variety of ways in which stock market movements impact on our lives.
The upbeat side of the growth in share ownership is that when the stock market goes up,
consumers with shares feel richer, they borrow more and they spend more. But just as
the stock market can go up, it can also go down. Usually, the first to react to this are the
institutional investors who are involved in the financial markets on a daily basis.
The internet boom is an example. Many personal investors felt they were burnt
by the popping of the dot.com bubble. By the time they got around to selling shares in
any number of failing internet-based companies, the big City investors had already
pulled out of the market. The institutional investors did not escape unharmed either. And
the hits that they took also have an indirect, but potentially serious, effect on many
21
people Ds financial health. Any pain suffered by thesenstitutional investors impacts on

the returns paid on pensions, savings accounts or the interest charged on mortgages.
For individuals with a more direct interest - say day traders attracted by the tech
boom - share holding can be used as collateral to borrow money. But if the value and
income from shares evaporate and the bank calls in the loan, the result can be big losses
or personal bankruptcy. Meanwhile pensions linked to the stock market, like the ones
being promoted by the UK government, are not immune. Unlike the state pension which
is paid out at a rate set by the government, investing in a private pension indexed to the
stock market can increase the value of the contributions dramatically, but they can also
be erased.
Your job can also depend on the markets as companies use their valuation and
the issue of new shares to raise capital to expand. If they are unable to do this then they
have to find ways of increasing the companyD s value to attract investors. The key tool
they use is to cut jobs.
Questions:
1. Who suffers the consequences when share prices go down?

Investors and the public/Almost everyone
2. What will be affected when the institutional investors made a loss in their
investments?
Returns paid on pensions, savings accounts, interest charged on mortgages
3. How can companies raise funds to expand?

They issue new shares.
4. What do companies do to increase the company's value?

Cut jobs
22
Individuals and groups of people doing business as a partnership have unlimited

liability for debts, unless they form a limited company. If the business does badly and
cannot pay its debts, any creditor can have it declared bankrupt. The unsuccessful
business people may have to sell nearly all the possessions in order to pay their debts.
This is why most people doing business form limited companies. A limited company is
a legal entity separate from its owners, and is only liable for the amount of capital that
has been invested in it. If a limited company goes bankrupt, it is wound up and its assets
are liquidated to pay the debts. If the assets don't cover the liabilities or the debts, they
remain unpaid. The creditors simply do not get all their money back.
Most companies begin as private limited companies. Their owners had to put up
the capital themselves, or borrow from the friends of a bank, perhaps a bank specializing
in venture capital. The founders had to write a Memorandum of Association or a
Certificate ofIncorporation which states the company's name, its purpose, its registered
office or premises, and the amount of authorized shares capital. They also write Articles
of Association or Bylaws, which set out the duties of directors and the right of
shareholders or stockholders. They send these documents to the registrar of companies.
Successful, growing company can apply to a stock change to become a public
limited company or a listed company. Newer and smaller companies usually join "over-
the -counter" market such as the Alternative Investment Market in London or NASDAQ
in New York. Very successful businesses can apply to be quoted or listed on major stock
exchanges. Publicly quoted companies have to fulfill a large number of requirements,
including sending their shareholders an independently audit report every year,
containing the year's trading results and a statement of their financial position.
Questions
1. Why do most people doing business form of limited company?
They are only liable for the amount of capital that has been invented in the limited
company, so they don't have to sell their possessions to pay the debts.
2. What are the risk of the creditors?

When a company goes bankrupt, if the assets don't cover the liabilities or the debts, they may not get all their
money back.
3. What is an "over-the-counter" market?
It is the market for newer and smaller companies.

23
4. What are the obligations of companies whose shares are traded on the stock
exchanges? They have to fulfill a large number of requirements, including sending their
shareholders an independently audit report every year, containing the year's trading
results and a statement of their financial position.
PART 4. TRANSlATION
4.1 EnlPlsh • VletnaJlle8e translation: Translate the following sentences Into
VletnaJlle8e.
1. Companies use an investment bank to find buyers and to underwrite the stock issue.
cac cong ty su dung ngan hang dau tu de tim kiem nguoi mua va de bao lanh su phat hanh co phieu
2. Companies either distribute part of their profits to shareholders as an annual dividend.

cac cong ty co the phan phoi mot phan loi nhuan cua ho cho cac co dong nhu la co tuc hang nam
3. How can you make money from a falling stock market?

lam sao ban co the kiem duoc tien tu thi truong chung khoan dang di xuong?
4. After the strong gains of last week, Asian shares slipped on fears of a looming
recession.
sau khi tang manh vao tuan truoc, chung khoan chau A da xuong doc do su so hai ve
mot cuoc suy thoai kinh hoang
5. Most shares were a little stronger in Madrid this morning when the exchange
reopened after yesterday's public holiday.
hau het cac co phieu da tang kha mnh tai Madrid vao sang nay, sau khi san chung
khoan mo cua lai sau ngay nghi le truyen thong hom qua
4.2 VletnaJlle8e • English translation: Translate the following sentences Into

English.
24
1. Cac cong ty dai cluing duoc giao dich cong khai tren thi tnrong mo voi c6 phieu
duoc mua boi nhieu nha d~u tu.
Public companies are publicly traded within the open market with shares being
purchased by a variety of investors.
2. H~u h~t cac cong ty dai cluing ban d~u la nhirng cong ty tu nhan dil dap irng duoc
h~u h~t t~t ca cac quy dinh v~ phap ly.
Most public companies were originally private companies that met all of the
regulatory requirements.
3. Cong ty dai cluing c6 nhirng loi th~ c6 hiru nh~t dinh so voi cong ty tu nhan, bao
g6m kha nang ban c6 phan trong tirong lai va tang kha nang tiep can thi tnrong no.
Public companies have certain inherent advantages over private companies, including
the ability to sell future equity stakes and increased access to the debt markets.
4. C6 dong la chu cua cong ty, boi vay ho mong muon cong ty hoat dong mot each hieu
qua.
Shareholders are the owners of the company so they expect the company to perform
effectively
5. Cac cong ty khoi nghiep se kh6 duoc niem y~t tren b~t ky san giao dich clnrng khoan
nao vi ho yeu c~u cong ty phai c6 lili moi duoc niem y~t c6 phieu,
Start-ups will find it difficult to be listed on any securities exchanges because they
require the companies to be profitable to go public.
PART 5: WRmNG
phrases.
1. After shares have been issued, they can be traded on the secondary
. market
2. The rise and fall of stocks prices depend on supply and demand
. or the market forces
3. Blue chips are shares in well-established companies

. with a good reputation for quality
and profitability.
25
4. A private company can go public by offering their stocks for sale

. to the financial institutions and
the general public.
5. Hedge funds can "short" shares by borrowing them off a conventional
. fund and then
selling them.
26
M()()UL~4: 4CC()U~TI~t7
~()
r=1~~CIM §T4Tbt~T§

1.1 Choose the best definition for each tenn.
1. Accrue
A. to try to deal with a problem.
B. to have control over something, or to be the most important person or thing.
C. to prevent something from continuing as expected.
D. to allow a sum of money or debts to grow over a period of time.
2. Tangible assets
A. a company's buildings, machinery, etc.
B. something that does not exist as a physical thing but is still valuable to a company.
C. a list of goods that have been sold, work that has been done, etc., showing what
you must pay.
D. the part of a company's profits from previous years which have not been paid to
investors.
3. Par value
A. the capital that a company has from shares rather than from loans.
B. a written note in a bank account showing a sum of money owed or spent.
C. a sum of money paid into a bank account.
D. the value that a share in a company originally had.
4. Creative accounting
A. the calculation of all the expenses involved in producing something, including
materials, labour, and all other expenses.
B. the process of recording and analysing the costs involved in running a business.
C. a way of presenting the accounts of a business that might not show what the true
situation really is.
27
D. the process of making decisions, planning future operations, and developing

business strategies.
5. Audit
A. an official examination of business and financial records to see if they are true
and correct.
B. a person whose job is to keep or check financial accounts.
C. a written statement showing the amount of money and property that a company
has.
D. a recruiter of important personnel for companies.
1 Expenditure 2 Liabilities 3 Bookkeeping
4 Retain 5 Defer
A. the job or activity of keeping an accurate record of the accounts of a business.

B. the act of spending or using money; an amount of money spent.
C. to delay something until a later time.
D. to keep something; to continue to have something.
E. the amount of money that a person or company owes.
2.1 Passage 1. Complete the passage with the words In the box.
guarantee operations transactions warranty procedures liabi lities
vaults performance auditor fraud institution credit

28
A bank auditor monitors the (1) of her bank to ensure its compliance with
industry guidelines and adherence to measures that deter (2) . Her job generally
requires she establish and follow a schedule to regularly check the appropriateness of
all business activities. She may work in a large or small financial (3) __
In an industry frequently considered highly competitive, a bank auditor reviews
the general and specific aspects of daily practices to (4) her bank remains
competitive and maintains the integrity expected by its customers. She scrutinizes every
practice from teller (5) through the security of the bank's (6) and courier
services. As an industry professional, she is generally aware of competitors' (7) __
She is typically expected to objectively rate her bank's (8) __ against others and take
measures to improve upon areas that fall short of excellence.
customer depreciation receivable retained defer ledgers
invoices auditors receipts figures journals declare
The accounting process starts with inputs, and these are things such as sales
documents ((1) ---) , purchasing documents ((2) ), payroll records, bank
records travel and entertainment records. The data in these inputs is then processed by
specialized software. Entries are recorded chronologically into "(3) ".
Information from the journals is posted (= "transfered") into "(4) ", where
it accumulates in specific categories (cash account, sales account, or account for one
particular (5) )
A trial balance is prepared at the end of each accounting period. This is a
summary of the ledger information to check whether the (6) are accurate. It is
used directly to prepare the main financial statements (income statement, balance sheet
and cash flow statement).
29
The financial statements of large companies have to be checked by an external

firm of (7) who "sign off on the accounts" (= officially (8) the accounts
are correct). They are publicly available, and appear in the company' annual report.

3.1 Reading passage 1: Read the passage carefully and briefty answer the
Companies' financial statements have to give a true and fair view of a company's
profit and its assets and liabilities. This implies that there are various ways of doing
accounts, and indeed there are, but companies have to adopt certain principles: in the
USA, Generally Accepted Accounting Principles (GAAP), and in most of the rest of the
world, International Financial Reporting Standards (lFRS), previously known as
International Accounting Standards (lAS)
The time period principle is that accounts are always for the same length of time,
usually 12 months. This prevents companies manipulating their accounts by changing
the end of the financial year to disguise bad periods. The consistency principle states
that companies have to use the same methods (e.g. of valuing depreciation and inventory)
year after year.
Accounts are usually prepared on the historical cost principle which is that all assets
are stated at the value at which they were originally brought into the company. This
means the companies do not need to calculate the current value of assets every year,
although this can be misleading in periods of high inflation.
The going concern principle is that a company can and will continue in business and
pay its liabilities and creditors. This is why the current value of asset is irrelevant: they
are not for sale.
The matching principle is that revenue or income is recorded in the periods it is
generated, along with related costs and expenditure.
30
Examples of this principle are depreciation and amortization, which are ways of
matching the cost of a long-lasting asset over the period during which it earns revenue.
Conservatism or prudence means that you do not recognize any income unless you are
almost certain to receive it, and you record costs as soon as they are incurred. This means
that, if anything, companies should understate rather than overstate profits.
Consolidation means bringing together the accounts of all a company's subsidiaries
into a single set. This allows stockholders to find out if an apparently profitable company
has a non-profitable subsidiary with huge liabilities.
Questions
1. How many accounting principles are mentioned in the passage?
There are seven accounting principles mentioned in the passage.
2. Is it necessary to record the current value of company's assets?

No it isn't.
3. According to conservatism, how should a company record its profit?

Companies should understate rather than overstate profits.
4. How can consolidation benefit stockholders?

They can know if an apparently profitable company has a non-profitable a subsidiary
with huge liabilities.
Companies are required by law to grve the shareholders certain financial
information. Most companies include three financial statements in the annual reports.
31
The profit and loss account shows revenue and expenditure. It gives features for
total sales or turnover (the amount of business done by the company during the year),
and for costs and overheads. The first figure should be greater than the second: there
should generally be a profit - an excess of income over expenditure. Part of the profit is
paid to the government in taxation, part is usually distributed to shareholders as a
dividend, and part is retained by the company to finance further growth, to repay debts,
to allow for future losses, and so on.
The balance sheet shows the financial situation of the company on a particular
date, generally the last day of its financial year. It lists the company's assets, its liabilities
and shareholders' funds. A business's assets consist of its cash investments and property
(buildings, machines, and so on) and debtors - amounts of money owed by customers
for goods or services purchased on credit. Companies also have intangible assets, whose
value is difficult to quantify or turn into cash such as goodwill, patents, copyrights and
trademarks. Liabilities consist of all the money that a company will have to pay to
someone else such as taxes, debts, interest and mortgage payments as well as money
owed to suppliers for purchases made on credit, which are grouped together on the
balances as creditors. Negative items on financial statements such as creditors, taxation,
and dividends paid are either enclosed in brackets or a minus sign.
A third financial statement has several names: the source and application of funds
statement, the sources and uses of funds statement, the fund flow statement, the cash
flow statement, the movements of funds statement, or in the USA the statement of
changes in financial position. As all these alternative names suggest, this statement
shows the flow of cash in and out of the business between balance sheet dates. Sources
of funds include trading profits, depreciation provisions, borrowing, the sale of assets
and issuing shares. Applications of funds include the purchase of fixed financial assets,
the payment of dividends and repayment of loans, and, in a bad year, trading losses.
(Adapted/rom Business/or English Studies, 2nd ed., page 79)
Questions:
1. What do companies do with their profit?
Part of the profit is paid to the government in taxation, part is usually distributed to
shareholders as a dividend, and part is retained by the company to finance further growth,
to repay debts, to allow for future losses, and so on.
32
2. What is the function of a balance sheet?

It lists the company's assets, its liabilities and shareholders' funds
3. Are company's assets always tangible?

No, they can be intangible assets.
4. What does a cash flow statement present?

This statement shows the flow of cash in and out of the business between balance
sheet dates.
PART 4: TRANSlAll0N
4.1 EnlPish . \'ietnaJlle8e translation: Translate the following sentences into
VletnaJlle8e.
1. In most countries, companies record the historical cost of their assets - their original
purchase price, and not their current selling price or replacement cost.
O hau het cac nuoc, cac cong ty ghi chep li nguyen gia tai san cua ho - gia mua ban
dau chu khong phai la gia ban hien ti hay gia thay the.
2. Alternatively, you could present the accounts of a company you work for or have
worked for or know well.
ngoai ra, ban co the trinh bay cac tai khoan cua mot cong ty ban lam viec hoac da
tung lam viec hoac biet ro
3. All the money that a business spends on goods or services during a given period is
expenditure.
tat ca so tien ma DN chi cho hang hoa hoac dich vu trong mot thoi ky nhat dinh la chi tieu
4. A balance sheet is a statement showing the value of business Ds assets, its liabilities,
and its capital or shareholderD s equity.
bang can doi ke toan la mot bao cao the hien gia tri tai san cua doanh nghiep, cac khoan no phai tra
va von hoac VCSH cua co dong.
33
5. Google's financial statements use American terms, which sometimes differ from
British ones.
BCTC cua gg su dung cac thuat ngu cua My, doi khi khac voi thuat ngu cua Anh
4.2 Vietnamese· EnlPish translation: Translate the following sentences into

EnlPish.
1. Bao cao k~t qua hoat dong kinh doanh t6m t~t cac khoan doanh thu va chi phi cua
cong ty trong toan b9 ky bao cao.
The income statement summarizes the revenues and expenses generated by the
company over the entire reporting period.
2. T~t ca cac cong ty c~n t:;10ra doanh thu d~ duy tri hoat d9ng kinh doanh. Doanh thu
duoc sir dung d~ thanh toan chi phi, tra Eii cho cac khoan no va thu~ phai tra cho
chinh phu,
All companies need to generate revenue to stay in business. Revenues are used to pay
expenses, interest payments on debts and taxes owed to the government.
3. Sau khi chi phi kinh doanh duoc tnr ra khoi thu nhap, s6 tien can lai duoc goi la thu
nhap rang.
After the costs of doing business are paid, the amount left over is called net income.
4. Bang can d6i k~ toan la mot tai lieu chinh tlnrc sir dung thea dinh dang k~ toan chuan
th~ hien cac 10:;1itai san, no phai tra va v6n chu So' hiru cua c6 dong.
A balance sheet is a formal document that follows a standard accounting format
showing the same categories of assets, liabilities and shareholder's equity.
34
5. Bao cao dong tien cua cong ty la bao cao hrong tien duoc t:;10ra va chi tieu duoc
phan thanh ba muc: hoat dong kinh doanh, hoat dong tai tro va hoat dong d~u tu.
The corporate cash flow statement reports the cash generated and used III the
following categories: operating activities, financing activities and investing activities.
PART 5: WRITING
phrases.
1. The balance sheet reports the company's
. specific condition on a specific date.
2. Bookkeepers and accountants are responsible for keeping records
. and providing
financial information about the business.
3. Accounting principles applied by the
. companies vary Irom country to country:
4. The assets are listed on the left side .of the balance sheet
5. Tax accounting calculates how much a company
. will have to pay to the local and
national governments.
35
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r:UI2TIi~12J)124CTIC~
36
J)~Tl
V()C~UIAl2~
J)124CTIC~
37
Exercise 1: Match these tenns with their corresponding meanings.

1. Investment bank
2. Merger
3. Inbound acquisition
4. Entrepreneur
5. Outbound acquisition
A. an occasion when one company joins with another company to create a larger
company.
B. an occasion when a company in your country takes over a company in a foreign
country.
c. an occasion when a foreign company buys a company in your country.
D. an entity that advises companies on how they can grow by joining with, or buying
other companies.
E. somebody who has set up and runs their own company.

1. Management buyout
2. Innovation company
3. Internal rate of return
4. Business plan
5. Porfolio of investments
A. when investors invest in a range of companies, they are said to have it.
B. a company which develops a new product or service potential.
C. investors need to study and have confidence in it before they take the risk of
investing in a start-up company.
38
D. the figure most commonly used by investors to judge whether a potential

investment is a good idea or not.
E. an occasion when the managers of a company decide to break away from that
company and buy part of it in order to run it separately.

1. Financial engineering
2. Highly leveraged
3. Collateral
4. Cash-settled
5. Share shortage
A. when there are not enough shares available on the market to supply the demand
for them.
B. the use of various mathematical tools to maxnnize profits from financial
investments.
C. when (for example) shares that are bought on a financial market are paid for with
real money.
D. when the major part of an investment is funded by borrowed money.
E. assets which are promised by a borrower to a lender if the borrower cannot repay
a loan (also known as security).
1. The Treasury
2. Corporate credit rating agency
3. ~orgagelender
39
4. Subprime morgage
5. Credit squeeze
A. the government department in charge of the money that a government collects in

taxes and from borrowing, and the money that it spends.
B. a company that calculates the risk of lending to or investing in a company or its
financial products.
C. a restraint or limitation of credit; usually (although not always) a government
measure designed to reduce inflation, by methods such as increasing interest rates.
D. a loan to buy a house which has been given to a borrower with a poor credit rating.
E. a company that provides loans of money for people to buy houses.

1. Insolvency
2. Liquidation
3. Administration
4. Receivership
5. Fraudulent
A. intending to deceive.
B. when a company which is experiencing financial difficulties is reorganised by an
independent specialist with the aim of continuing some of its activities.
C. when a failing company stops operating and its assets are sold to pay its debts.
D. when a company that is bankrupt is put under the control of an individual by the
courts.
E. when a person or company does not have enough money or assets to pay their
debts.
40

1. Wholesale funding
2. Retail deposits
3. Consumer lending
4. Corporate lending
5. Loan exposure
A. money which is lent to private individuals.
B. (debt) method that banks use in addition to saversD deposits to finance operations.
C. the money that savers put into banks.
D. the total amount of money a financial institution has lent to customers.
E. money which is lent to companies.
Exercise 7: Use the words in the box to complete the sentences.
risk management foreign investment scale hostile bid
broke global brands corporate financiers
1. China is keen to acquire __ . It can reduce costs by moving their manufacturing

sites to China.
2. are excited about their future prospects in China.
3. In the past, expertise was an important by-product of inward investment by
foreign financial institutions.
4. This has allowed the amount of __ in China to grow over the last decade.
5. These days, Chinese banks have plenty of money, but a few years ago, many of them
were nearly __
41

fast-growth curve worth business plan investments
high return start-up internal rate of magnitude
return
1. Last year, we added three more __ companies to our portfolio of investments.

2. We think that one of the companies looks particularly promising. It claims a very
high __
3. All of the start-up companies tried to persuade us that they would all provide a return
of the we were looking for.
4. We expect to see their sales hit the __ very soon.
5. All we ask from these investments is a

options position security blocking minority
short squeeze derivatives free float
1. Porsche had been making a larger profit out of __ trading than it has out of selling
cars.
2. Little by little, it had bought up a large percentage ofVW share .
3. The outcome of Porsche Ds European Commission challenge to the State of Lower
SaxonyDs of20% would decide whether they continued to do this.
4. Up to now, the demand for VW shares had been higher than supply. This had
kept their price very high.
5. However, if Porsche did not win its European court case, it would probably decide
not to take its stake to 75%, and would close its options __ on the remaining VW
shares.
42
fraudulent insolvent disqualification order book
liquidation remedies sharp downturn
1. When economic conditions become difficult, businesses can experience a III
trading.
2. The directors were hiding financial problems III the company, and after an
investigation, their dealings were found to be __
3. As a result, the directors were subject to severe . They went to prison.
4. In addition to this, they suffered as company directors for several years.
5. They had also entered false items into their __ to make their business look more
viable than it actually was.
collapse recession loan exposure boom
wholesale funding credit crunch vulnerable
1. In 2008, the UK experienced a __ ' which meant that people found it more
difficult to get a loan from a bank.
2. In 2006, HBOS shares had hit an all-time peak. By 2008, however, the picture was
quite different. The bank was on the point of __
3. HBOS had adopted a very aggressive funding model which left it very when
the credit crunch hit.
4. The bank had relied too heavily on and not enough on retail deposits.
5. Added to that, the bankD s saleslriven culture had resulted in the bank having an
extremely high __ . It had lent far too much money to customers.
43
J)~T~
CL()Z~ J)4ii4t7~i
44
Passage 1. Complete the passage with the words in the box.

withdraw liquidity customer corporate surplus income
deficit deposit rate maturity return passbook
If a customer has more money than he'd like to use in the near future, he may ask
to open a (1) . account. This type of account combines a relatively small (2) _
with a maximum degree of (3) . There are different types of accounts. Best known
is the savings account which represents a widespread method of saving money. After
opening the account, the customer may deposit as much money as he wants to. However,
if he wants to (4) __ a large amount, he must announce the bank prior 24 hours,
although in practice small amounts are paid immediately. For a savings account a (5)
__ is issued to the depositors. The rate of interest may vary with the bank (6) __
and with the customer's stay for a shorter length of time. One advantage is that even
young children are allowed to have a savings account in their name. However, it may
only be conducted by their parents or guardians.
Fixed deposits can be withdrawn only on a fixed date while term deposits after
an agreed number of days' notice. The customer decides whether to invest his (7) _
money for a certain period of time or whether he wishes to withdraw it after a certain
length of notice. The rate of interest will largely depend on the length of investment or
notice. At (8) date, banks pay the interest into the customer's current account and
invest the money again for the same period of time unless the customer orders his banker
to act otherwise.
Passage 2. Complete the passage with the words In the box.

financial automatic assess arrangment corporate interest
identification private mortgage withdraw savings raise

45
Banks are not only places in which we can save money or conduct (1) _
business, but also institutions from which people can borrow money. Every day, many
people go to banks for loans, such as (2) --
contract that binds the lender to a
schedule of payments, so both parties should be cautious and not enter into the (3) __
without thinking. Banks will look at such factors as how much people have saved in
determining whether to make a loan.
Before lending money, a bank has to (4) the risk involved. Generally, the
greater the risk, the higher the interest rate they charge. Banks also have more
complicated risk assessment methods for (5) __ customers - business clients.
However, businesses today prefer to (6) __ their own finance rather than borrow
from banks.
Banks have different kinds of accounts. Some pay high quarterly interest. Some
accounts severely restrict the number of times that customers can access their accounts,
or the amount of cash they can withdraw. Today, electronic banking can be used to check
the balance on an account, or to see if (7) transactions have been made. This can
be done from our home or office computer. When you go to the bank, be sure to bring
(8) . Usually a bank will only accept a photo Il), and a signature is not a valid Il).

property cashiers trainees insurances secrectary transfers
financial trainers accountant head transaction teller
UBCS international is a leading international bank. We provide an excellent

range of products and services, including current accounts, savings accounts, mortgages,
(1) , loans, foreign exchange services and investment advice. We have 2000
employees in our (2) __ office in Frankfurt and 3,800 in our 320 branches in Europe,
the Middle East and Asia. We give our (3) experience in all our departments:
46
* Our (4) __ serve the bank's customers. They help customers make deposits
and withdrawals, check balances, answer questions and help customers with their
everyday banking needs
* At our foreign exchange counter, the cashiers sell foreign currency to customers
who want to go abroad
* Our mortgage advisers arrange mortgages for customers who want to buy (5)
__ . They set up insurance policies
* Our (6) __ advisers give customers information about stocks and shares, bonds
and other types of investments
Customers can use the bank's website to carry out payments and other (7) __
over the Internet. This form of banking can be done outside business hours and from
anywhere with Internet access. Features of Internet banking include payment of bills,
fund (8) , loan applications, and viewing bank statements.
Passage 4. Complete the passage wtth the words In the box.

dividend partner fixed bonds maturity return
coupon mutual shareholder matures earnings profit
I'd like to discuss about three basic investment options. First, you can buy shares.
You then become a (1) , that is part owner of a company. When the company
makes a profit, the shareholders get a share of that profit. This payment is called a (2)
--
. The price of shares can go up or down, so there is no guarantee you can make a
profit when you sell your shares. However, share prices can rise a lot, so you can make
a lot of money. (3) are another type of investment. When you buy a bond, you
are lending your money to a company, or sometimes to a government. In return, they
agree to pay you a (4) rate of interest on your money. In addition, you get your
capital back on a certain date in the future. This is called the date when the bond (5)
--
. There is little risk here, but the returns are quite low. Finally, you can invest in a
47
(6) fund. This is a collection of shares and bonds. You put your money together
with money from other investors. You pay a financial professional, a fund manager, to
handle your investment. The fund manager decides what shares and bonds to buy and
sell. There isn't a predictable rate of (7) . Your (8) change from day to day.

host department representative provisions branches control
parent participation office organization subsidiaries join
Nowadays, banks have moved into external and international markets with an
agency or a (1) office because it is relatively easy for them to establish these
offices. The most important factors affecting the choice of office type include the
attitude of the (2) country as reflected in its laws, regulations and policies towards
these financial institutions. Some countries prohibit foreign commercial branches;
others prohibit foreign-held (3) . And, of course, some governments do not accept
both foreign branches and subsidiaries. In other cases, entry of new firms is prohibited,
but outside firms already in existence are permitted to function under grandfather (4)
__ . Over a dozen foreign countries permit no foreign commercial banking except for
representative offices, and only a small amount of trade is conducted with these
countries. In some cases, the policy of the home country of the (5) bank may
determine or at least influence the type of office established abroad. In at least a few
instances, certain types of oversea offices are not permitted by the government of the
parent company. Generally, (6) are easier to establish than a subsidiary in a
foreign country and they afford the parent company the greatest degree of (7) .
Accordingly, as full- service types of offices, branches playa key role in external
markets. The type of office a bank establishes abroad also depends on the extent of
market (8) desired by the bank, the amount that can be invested in the facility,
and the availability of trained and talented staff.
48

standardized finalize foreclose change supply repayments
ownership mortgage fluctuation collateral demand loan
In everyday language, a (1) is a long-term loan a customer can ask from

the bank to buy real estate. In fact, it is an instrument in which the customer gives the
(2) of his house or land to the bank as a (3) . In other words, if he fails to
repay the loan, the bank will become the owner of his real estate.
However, the (4) of the mortgage money has become very tight lately. It
has not been easy to get a mortgage. The borrower must meet some requirements such
as: being a good risk, having enough money for the down payment and being able to
make monthly (5) . Ifhe does not pay for any reason, the bank will (6) the
mortgage.
In the past, banks offered fixed-rate mortgages which used the same rates over
the life of the loan; but recently banks have begun to insist on variable-rate mortgages
whose interest rates are adjusted according to the (7) __ of interest banks pay to
deposits.
Most retail banks have (8) products for personal customers, such as
personal loans. This means that all customers who have been granted a loan have the
same terms and conditions - they have the same rules for paying back the money.

loss sustainable price signals expenditure benefit
functioning changed restrain demand cost pressures
One of the Bank ofEnglandOs key responsibilities as the Central Bank of the U.K
is the conduct of monetary policy. The BankO s role is to deliver price stability by setting
short-term interest rates. The objective of monetary policy is to (1) inflation - or,
to put it another way, to control the general increase in the prices of goods or services.
49
Uncertainty about inflation and future price levels is damaging the proper (2) of
the economy. With a stable general price level, individual price (3) can be read
more clearly, and more rational decisions can be made about whether to save or borrow,
how much to invest and consume, and what and when to produce. In this way, price
stability can help ensure (4) long-term economic growth.
Monetary policy operates by influencing the (5) of money. The Bank sets
an interest rate for its own assets with the market and that rate then affects the whole
pattern of rates set by commercial banks for their savers and borrowers. This will affect
other prices, e.g. shares and property, customer and business (6) , and employment
salary. If rates are set too slow, this may encourage (7) so that inflation is
persistently above target. If they are set too high, there is likely to be an unnecessary (8)
__ of output and employment, and inflation is likely to be persistently below target.

supervisors pension fast - track trainer mutual duties
counter trainee administrative appraisal analyst call centers

1. Jobs in banking
Banks offer many different jobs, from (1) cashier right up to account
manager or investment (2) __ . Many jobs are in specialist areas such as IT or
corporate banking for business customers. Some banks have (3) __ where customer
service advisers answer telephone enquiries. In the UK today, building societies,
insurance companies and even supermarkets can offer the same services as banks. There
is a lot of competition, so banks always need top-quality staff with good communication
skills.
2. Training and opportunities
Trainees with basic school qualifications usually process cheques and do (4)
__ tasks. They then take a training course to become cashiers. Good cashiers often
50
become (5) , responsible for their own teams of employees. Graduate trainees
have a (6) training course. They usually spend about two years learning how the
bank works. Then they can get management positions. Branch managers spend a lot of
time with customers and sometimes visit business customers in their office or factory.
3. Working conditions
Working hours are usually 9 am to 5 pm. Most banks have an (7) system
and give salary increases according to performance. Some also have good (8) _
schemes. Larger banks have sports facilities for activities such as golf and tennis.

obtain commissions denominations serial money passport
receive refund insurance debited currencies repay
When travelling abroad, it is always wise to carry your money in travellers'

cheques because cheques are protected against loss or theft. If your cheques are lost or
stolen, the issuing authority will (1) your money. Not only are they safe, they are
also convenient. They are available in different (2) and different (3) and
they can be cashed at most banks throughout the world. Most shops, hotels and
restaurants also accept them.
To (4) travellers' cheques, you usually go to your bank. They can be paid
for in cash or (5) to your account. Large amounts, however, must be ordered in
advance. For the safety and convenience of travellers' cheques, you are charged two (6)
__ . An (7) commission (usually 1%) when you buy them and an encashment
commission (this varies) when you cash them. They are very easy to use. When you
collect them, you sign each cheque once. The cashier may enter the amount in your
passport. When you cash them, you sign each cheque again. The cashier will usually ask
to see your passport again too.
51
It is advisable to make a note of the (8) ---

numbers and denominations of
your cheques in case they are lost or stolen. Remember to keep this separate from the
cheques.
service statement value cheques cash matter
difference currency issue credit limit clear outstanding
Banks make their money on the (1) __ between what they payout in interest
on deposits and what they get in as interest from its loans. Nowadays, many banks offer
their customers credit cards. Any customer can apply for a credit card. If the bank thinks
the customer is a good risk, it will (2) him with a card and inform him of his
personal (3) . For example, the bank might allow a customer a limit of €2S0 per
month. This means that every month the customer can use his card to pay for €2S0 worth
of goods and services or to borrow €2S0 in (4) __ , travellers' (5) or foreign
currency. It does not matter if the customer's bank account is empty, when he spends or
borrows the €2S0. At the end of the month, the bank will send the customer a (6) __
If the customer clears his account every month, the facility will cost him nothing. He
will have a month's credit free. However, if the customer fails to (7) __ his account
every month, he will be charged some interest per month on the (8) __ balance.
Therefore, this alternative form of money can become very expensive.
target hosti Ie sale going surprised merge
objected demanding offer promotion buyout deal
The business community was (1) __ on Tuesday at a national corporation's

takeover of a regional auto parts maker. The Neilson - Williams Corporation made a
52
successful bid for the (2) __ of Western Manufacturing (WM). The (3) put an
end to a months- long corporate battle for control of the company.
For months, WM was the (4) of another national corporation, NexiCorp.
According to a spokesperson for WM, the board of directors (5) to NexiCorp's
unethical business practices. In fact, the majority ofWM's management team announced
intentions to quit ifN exiCorp' s (6) takeover was successful. But before N exiCorp
could complete the buyout, Neilson - Williams stepped in and made its own tender (7)
__ . Many hailed Neilson - Williams as a white knight for preventing the (8) _
to NexiCorp.
known repaid called deliver understood supported
provided financed get paid combined collected

Banks make their money on the difference between what they payout in interest
on deposits and what they (1) in as interest from its loan. For the majority of
homeowners, the purchase of their property is (2) by a mortgage. The bank or
building society which lends the money to buy a property is (3) __ a mortgage lender
or mortgagee. The person who borrows money in the form of a mortgage is called a
mortgage borrower or mortgagor. There are several different types of mortgage on the
market. Probably the most common is a repayment mortgage, in which the capital sum
and the interest are (4) in installments over a long period (for example, 25 years).
An alternative is an interest-only mortgage, in which the interest is paid, and the capital
sum is (5) in another way, for example with an assurance policy. This type of
mortgage is (6) as an endowment mortgage. With an offset mortgage, the
mortgage borrowerD s current account i(7) with her/his mortgage. (8) the
current account is usually in credit, this can reduce the interest repayments on the
mortgage.
53
much which itself their at like
the more its where from of
Every country has (1) __ own stock market, where people can buy and sell
shares and other securities. A stock exchange is a building (2) this trading takes
place. Some of these are very old - the London Stock Exchange started in the 17th
century. However, a lot of share trading today is conducted by computer. This is (3)
__ faster and cheaper.
Companies raise capital by selling their shares to investors on the stock market.
They use the money to run their day-to-day business and to expand. Investors buy shares
to make money. They hope to make a profit when (4) share price goes up. They
also get money (5) __ dividends.
A stock market index is a way (6) measuring a section of a stock market.
It is a list of the shares traded in the stock market. It shows the price of these shares (7)
__ the end of each trading day and the number of shares bought and sold. Investors
can look at the stock market indices in the newspaper. They can see how well or how
badly their shares are doing. Investors are usually institutions (8) banks, insurance
companies, mutual funds and pension funds who are investing money of private
individuals indirectly.
need writing reading offer charging collecting
earns connected store give lend separated
Banks are places where people can keep their money. Most people use banks to
save money in their savings accounts and to pay money from their checking accounts.
Today, when a person (1) money from their job, their paycheck is often
electronically deposited into their savings account. Then, he or she can pay their bills by
54
(2) checks from their checking accounts or pay online where their bills are
electronically (3) to their bank accounts.
Banks also (4) loans to people. Banks use the money that their customers
deposit to (5) to people to buy new houses, cars, or to start businesses. The bank
makes money from lending by (6) interest. In other words, people have to pay
back more than they borrowed. This amount depends on how risky the bank thinks the
borrower is and how fast the loan is paid back among other things.
Banks (7) many different jobs, from trainee cashier right up to senior
account manager or investment analyst. Many jobs are in specialist areas such as IT or
corporate banking for business customers. Some banks have call centers where service
advisors answer telephone enquiries. In the UK today, building societies, insurance
companies and even supermarkets can offer the same services as banks. There is a lot of
competition, so banks always (8) top-quality staff with good communication
skills.
inflation higher risk savings fluctuation make
aim current owners dividend capital terms

Investment means using money to buy something (an asset) with the (1) __
of making a profit by selling that asset at a higher price sometime in the future. There
are many different types of investments. Some people put their money in art, stamps, or
coins. Other people invest in shares and become part (2) __ of a company. Not only
can they make a profit by selling those shares at a higher price than they paid for them,
but they can receive a (3) - a share of the profits which the company gives to its
shareholders every year. People often ask about the difference between (4) and
investments. Sometimes the two (5) appear interchangeable, but there is a big
difference. Quite simply, investment involves some kinds of capital (6) There is
no guarantee that you will make a profit. In fact, the price of your assets may fall and
55
you may not even get back your (7) __ , the money you put in. Some banks call their
savings accounts Dinvestment accounts D, but this is wrong. The only risk of savings
accounts is that (8) will reduce the value of the money you put in them. There is
no risk of losing your capital.
deposit that collected found service widely
been maintained have present evolved past
Some economists think the Romans may (1) invented the cheques about
352 B.C. However, it wasnDt until the early l500s, in Holland(2) the cheques
were widely used. People who had a lot of cash began to (3) __ it with cashiers for
a fee, as a safer alternative to keeping the money at home.
The concept of writing and depositing cheques as a method of arranging
payments soon spread to England and elsewhere. But many people in the sixteenth and
seventeenth centuries still had doubts about trusting their money to strangers and little
pieces of paper. In the United States, cheques are said to have first (4) used in
1681 when businessmen in Boston mortgaged their land to a "fund," against which they
could write checks.
As cheques became (5) __ accepted bankers discovered they had a big
problem: how to collect the money from so many other banks. At first, each bank sent
messengers to the other banks to (6) cheques for collection, but that meant a lot
of traveling and a lot of money. The solution to this problem was (7) in the l700s.
A London bank messenger stopped for coffee and noticed another bank messenger. They
talked and realized that they each had cheques drawn on the otherD s bank, and decided
to exchange them and save each other the extra trip. The practice (8) into a system
of banking networks that exchange cheques with each other.
56
in if as who on when
for of over which from because
Most people who have a problem with cash flow can phone the bank and ask (1)
an overdraft. It is quick and easy, but it is not always cheap. Lloyds bank,
for example, is currently charging 18.8% per year plus a monthly fee of £8. Instead (2)
__ an overdraft, why not arrange a personal loan? An overdraft is really a short-term
measure for one or two months, but a personal loan is often a better idea (3) the
payments are over a pre-arranged period. Lloyds Bank charges customers an annual
percentage rate of 16.7% on a £1,000 loan (4) 12 months. If you see something
you want in the shops, there is usually not enough time to ask your bank for a loan, so
you can use a credit card. Buying (5) credit is expensive, but there are some good
offers. The favorite at the moment IS the Save and Prosper card, with an APR
(annualized percentage rate) of 13.9%. Customers with incomes of more than £25,000
can benefit (6) Gold Charge cards. These are not credit cards, but payment cards
for shops and restaurants, etc. They are useful (7) you want a large sum of money
quickly, but the amount you borrow must be repaid at a pre-arranged date. The annual
cost of the Midland Gold service is £70. Store cards are generally more expensive than
other credit cards, and can only be used in the shops (8) offer them. Marks and
Spencer customers currently pay an APR of 22.4%.
Passage 18. Complete the passage with the words In the box.
negotiated served crisis democracies previous regulation
anything relations sanctions returned economy unemployment
Born in 1883, John Maynard Keynes John studied economics at Cambridge

University. After his schooling, he worked for the Civil Service for a few years, then (1)
57
__ to Cambridge, where he taught students until 1915. When World War I started,
he (2) __ the Civil Service again, where he was responsible for economic (3) __
with the other countries at war. After the war, he was very unhappy about economic (4)
__ against Germany. In protest, he left his Civil Service job and then wrote his first
famous essay 0 The Economic Consequences of the Peace 0 in 1919. In the 1920s, Keynes
thought that government were wrong to do nothing about high (5) __ . At that time,
there was no economic theory to support his ideas, but in the mid-30s, he published the
book on o The General Theory of Employment, Interest and MoneyO. The world was now
in economic (6) __ ' and governments and politicians started to listen to KeynesO
theories. During World War II and later, many Western (7) __ accepted his idea of
maintaining high employment. In 1945, at the end of his Civil Service career, Keynes
moved to the USA and (8) __ a multi-bill ion- dollar loan for Great Britain. He died
the following year.
Passage 19: Complete the passage with the words In the box.
potential legislative examine realize translates asset
environment management
critical performance science organization perform physical
factors
ISO 5000 defines (1) __ as the "coordinated activity of an organization to

realize value from assets". In turn, assets are defined as follows: "An asset is an item,
thing or entity that has (2) __ or actual value to an organization". This is deliberately
wider than (3) assets but these form an important focus for more organizations.
Asset management involves the balancing of costs, opportunities and risks
against the desired (4) __ of assets, to achieve the organizational objectives. This
balancing might need to be considered over different timeframes.
58
Asset management also enables an organization to (5) the need for, and
performance of, assets and asset systems at different levels. Additionally, it enables the
application of analytical approaches towards managing an asset over the different stages
of its life cycle.
Asset management is the art and (6) __ of making the right decisions and
optimising the delivery of value. A common objective is to minimise the whole life cost
of assets but there may be other (7) such as risk or business continuity to be
considered objectively in this decision making.
Effective control and governance of assets by organizations is essential to (8)
__ value through managing risk and opportunity, in order to achieve the desired
balance of cost, risk and performance.
Passage 20: Complete the passage with the words in the box.
risk management annual report assess default
developed issues supervising retail
expected responsibilities implement supervision
The annual report published today provides an account of how the Bank of
England has exercised its (1) in respect of financial market infrastructure
supervision. It is the first such report since the Bank assumed new responsibilities for
central counterparties (CCPs) and securities settlement systems in April 2013 and
replaces the previous (2) on its supervision of payment systems last issued in
March 2013.
Since assuming responsibility for the (3) __ of CCPs, the Bank has devoted
a significant part of its supervisory effort to examining a number of key elements of
CCPs' financial (4) . Over the past year, UK CCPs have introduced new and
enhanced margin models as well as making a number of other improvements to their
59
risk management arrangements. Additionally, all UK CCPs have now introduced

arrangements to manage clearing member (5) losses that exceed their pre-funded
resources.
Also over the past year, the UK (6) payment systems BACS and FPS have
(7) plans to eliminate settlement risk through participants prefunding their
payments with cash held at the Bank of England. Implementation is (8) by the
end of20l4.
60
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61
Reading passage 1: Read the passage and answer the questions.

Bank of America Corp (BACN), the second-largest in the United States by assets, is
planning to cut about 300 jobs in its investment banking and capital markets group, as
it struggles to reduce costs to make up for weak revenue growth, as said by its CEO on
Tuesday. The layoffs are not as serious as the bankD s job cuts in areas like retail banking.
Wall Street companies have broadly been looking at cutting jobs recently. The bank
is also assigning junior bankers to work with broader groups of companies. That move
could also lead to more layoffs. The changes for junior bankers are part of the cost-
cutting program known as "Project New BAC," which the bank launched last year to
improve profits as the economy weighs on revenue growth, and new regulations boost
compliance costs. The bank is also trying to streamline a company that has grown
increasingly bigger after decades of acquisitions.
The first phase of the program is expected to cut about 30,000 jobs and $5 billion in
annual expenses in consumer and technology areas over the next several years. Plans for
the second phase, which covers investment banking, sales and trading, and commercial
banking, are expected to be finalized in May.
Questions
1. In what sector is the Bank of America Corp. planning to have the layoff?
investment banking and capital markets group
2. Why does the Bank of America Corp want to lay off their employees?
to reduce costs
3. What is the name of the program to reduce costs?

"Project New BAC"
4. By how much will the first round of layoffs cut expenses over the next couple of
years?
$5 billion in annual expenses
5. When is the second phase of the program intended to end?

in May
62

Banks are very important for the functioning of the modern world. Banks enable
people to save money, borrow money and to pay for things with ease and security. Each
country in the world has its own well-known banks that have branches in nearly every
city so that they are convenient for people to use. There are also some very big
multinational banks that have branches in most countries in the world. Each bank will
also have a head office. This is where all central tasks are performed that let the local
branches' function. The people that work in the branches will be the bank manager and
various tellers who work behind the bank counter and help the customers. There will
also likely be security guards to protect the money, workers and customers.
Most customers will just need to see the tellers when they go to the bank if they are
paying money into their account. However, they might need to see the bank manager if
they want to open an account, if they want to borrow money and get a loan, or if they
have spent more money than there was in the account.
Banks also offer their customers the more convenient methods of using either a debit
card or credit card because they just need to carry a small plastic card to be able to pay
for anything. When paying with a plastic card, customers will need to either sign a
receipt or enter a PIN number to confirm the purchase and that they are authorized to
use the card.
Questions
1. According to the text, what could people do with the banking services?
to save money, borrow money and to pay for things with ease and security
2. What is the function of the head office of a bank?

All central tasks are performed here
3. What is the role of the bank teller?

They work behind the bank counter and help the customers.
4. What happens when a bank customer spends more money than they have in their
account?
They need to see the bank manager
63
5. Why is a debit card or credit card convenient for customers?

Customers just need to carry a small plastic card to be able to pay for anything.

Commercial or retail banks are businesses that trade in money. They receive and
hold deposits, pay money according to customers' instructions, lend money, offer
investment advice, exchange foreign currency and so on. They make a profit from the
difference (known as a margin) between the interest rates they pay to lenders or
depositors and those they charge to borrowers. Banks also create credit, because the
money they lend is generally spent either on goods or services, or to settle debts and in
this way transferred to another bank account - often by way of a bank transfer or a check
- from where it can be lent to another borrower and so on. When lending money, bankers
have to find a balance between yield and risk and between liquidity and different
maturities so that the banks could make a profit.
Investment banks in Britain raise funds for industry on the various financial
markets, finance international trade, issue and underwrite securities, deal with takeovers
and mergers and issue government bonds. They also generally offer stockbroking and
portfolio management services to rich corporate and individual clients. Investment
banks in the USA are similar, but they can only offer advisory services and do not offer
loans. Investment banks make their profits from the fees and commissions they charge
for their services.
Any 3 items out of the followings: receive and hold
Questions deposits, pay money according
to customers' instructions, lend money, offer
1. List 3 functions of commercial banks. investment advice, exchange foreign
currency, ..
2. How can commercial banks make profits?

They make a profit from the difference between the interest rates they pay to lenders
or depositors and those they charge to borrowers
3. How can commercial banks create credit?
The money they lend in bank account can be lent again to another debtor.
64
4. What should bankers do when lending money to make sure that their banks could
make a profit? Bankers have to find a balance between yield and risk and between liquidity and
different maturities
5. What are the differences between British and American investment banks?
US investment banks can only offer advisory services and do not offer loans

There are different kinds of bank accounts. The most popular are the current and
deposit accounts. A current account pays no interest but it has other advantages. Firstly,
it enables people to keep their money in a safe place. Secondly, it allows them to
withdraw it at any time. Thirdly, it provides them with a cheque book so that they do
not have to carry a lot of cash.
To open a current account, it is necessary to see the branch manager. He has to decide
whether the applicant is likely to keep the account in credit. A current account holder
can only overdraw with the manager's permission. The manager will therefore want to
meet the applicant to get the necessary background information. For example, he will
want to know the applicant's occupation and his place of work. He will also probably
want a reference from his/her employer. If the manager is satisfied with the applicant
after the interview, he will approve the application, arrange for the applicant to be given
a cheque book and arrange for a monthly statement to be sent to him/her.
A deposit account is another popular kind of account. It has advantages over a current
account. First of all, it is easier to open than a current account. There is no need to see
the manager. A customer only has to fill in a form and then deposit the minimum amount
of money required by the bank. The customer is then given a pass book which he must
bring to the bank every time he wishes to withdraw or deposit money. The pass book is
the customer's record of the account. Secondly a deposit account earns interest for the
65
customer. The bank invests the money that the customer pays in and, in return, the bank
pays the customer interest.
Questions
1. What is the disadvantage of a current account?
It pays no interest.
2. What is the purpose of a cheque book?

Customers do not have to carry a lot of cash
3. What is the role of the branch manager?

The branch manager has to decide whether the applicant is likely to keep the account
in credit.
4. Why does the branch manager want to meet the applicant if the customer wants
to open a current account?
The manager wants to get the necessary background information.
5. List 2 advantages of the deposit account over the current account.

It is easier to open and earns interest for the customer.

More and more people are choosing to do their personal banking online. But what
can on-line banking offer that other types of banking can't?
Firstly, by banking online you are not limited to a bank's opening hours. You can
check your bank account 24 hours a day, whenever it suits you. Transferring money
from a savings account to a current account, opening an account or seeing how much
interest you have earned, will take you just a few seconds. Compare that with the time
you need to come to your local bank, queue up and carry out your transaction.
Online banking offers you numerous other services, from buying shares, to making
deposits, to ordering cheque books, to paying bills. For many people a particularly useful
feature of this kind of banking is the fact that you have access to a large database, which
contains details of all your accounts and the business you have done over the years.
66
All you need is an Internet connection to download the financial data onto your
computer. You may not be able to pay cash online. So, on-line banking does offer many
benefits.
At present banks, especially those engaged in foreign trade and foreign exchange
transactions, find it useful to become part of the international electronic message
switching network operated by "SWIFT". The acronym stands for the Society for
Worldwide Interbank Financial Telecommunications which provides the network that
enables financial institutions to send and receive information about financial
transactions in a secure, standardized and reliable environment.
Questions
1. When can we check the account online?
Any time/ 24 hours a day /Whenever it suits you.
2. How long does it take you to check the interest you have earned in the online
banking?
just a few seconds
3. According to the reading text, what is a database?

details of all your accounts and the business you have done over the years.
4. What does the acronym SWIFT stand for?

the Society for Worldwide Interbank Financial Telecommunications
5. What is the function of SWIFT?

It enables financial institutions to send and receive information about financial

The BBC says that HSBC, the worldDs second largest bank, helped rich people to
hide money so they would not have to pay tax. A BBC documentary programme got
access to the details of thousands of private bank accounts, worth $128 billion, from an
HSBC bank in Switzerland. The information was leaked by a whistleblower in 2007.
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The whistleblower was a computer expert working for HSBC in Geneva. He stole the
details of more than 100,000 clients worldwide. A French banking team looked at the
stolen data in 2013. It concluded that 99.8% of French citizens on the list were probably
evading tax.
HSBC said the bank has changed a lot since 2007. It said: "HSBC has developed
numerous methods to prevent its banking services being used to evade taxes." HSBC
told its reporters that the bank understood that it failed to follow the law properly.
However, one woman lost her job when she complained that the bank did not make these
changes. Sue Shelley was responsible for making sure HSBC followed the law. The
BBC said that when she complained that the bank was not keeping its promise to change,
the bank fired her. Panorama said HSBC is now facing criminal investigations in the
USA, France, Belgium and Argentina.
Questions
1. For what purpose did HSBC help rich people to hide their money?
in order not to pay tax
2. What did a whistleblower do in Geneva in 2007?

He stole the details of more than 100,000 clients worldwide.
3. What did the French banking team conclude in 20l3?

99.8% of French citizens on the list were probably evading tax
4. What happened with the woman when she complained that HSBC did not keep
the promise to change?
The bank fired her.! She was fired by the bank.
5. What was the duty of Sue Shelley?

Sue Shelley was responsible for making sure HSBC followed the law.
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The internet has expanded our choices of where and when to shop, but it also has its
disadvantages. Here are some things that you should think about before becoming an
Internet shopper.
It is safer to buy from famous companies, so do a little research on the company
before making your purchase. Check carefully all the contact details of the company.
Look for a street address and a telephone number, not just an e-mail address. Also,
consider any extra costs - things like shipping costs and taxes - that you may have to
pay and decide if it's actually worthwhile buying online.
Generally, people pay for online goods with credit cards. Make sure that the site is
secure. At the bottom of the site, you should see a small's' - which stands for 'secure'
- along with a picture of a padlock. Make sure you keep copies of the order form and
the acknowledgment notice that you receive.
When you buy online, you have the same legal rights as when you buy in a store.
However, it's very important to read all the terms and conditions of the sale before you
buy. Always check your bank statement after making a purchase and make sure that
only the amount that you paid has been deducted from your balance.
Each country has its own consumer affairs offices that should be able to advise you
if you find that you have been cheated while shopping online. The most important thing
to remember is 'if in doubt, don't buy.'
Questions
1. What information of the company should we know before making the purchase?
the contact details and extra costs.
2. How do customers make sure that the site is secure?

At the bottom of the secure site, there is a small's' - which stands for' secure' - along
with a picture of a padlock.
3. When we pay for online goods with credit cards, what should we keep?
We should keep copies of the order form and the acknowledgment notice that we
receive.
4. What should we do after making a purchase online?
We should check the bank statement and read all the terms.
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5. What is the role of "consumer affairs offices"?

They advise us if we find that we have been cheated while shopping online

First National bank is run entirely through the telephone and the Internet. Its
success shows that customer service is not just about face-to-face contact with clients.
The primary concern of the bank is recruiting the right people. They believe that some
skills such as computer skills and professional skills can be taught, but a member of staff
can't be taught to be a nice person. So, they only recruit people who already exhibit
good communication skills.
Unlike other services that operate primarily over the telephone, the staff at First
National do not use scripts. The managers recognize that customers find them
impersonal and unnatural. What this bank asks for is that staff be themselves and
establish a good relationship with their customers. Part of this is recognizing people's
needs. The member of staff has to pick up on the caller's mood and react accordingly.
The website designers at First National Bank spend a great deal of time
understanding their customers and offering services which meet their needs. For
example, they already offer a service in which customers receive a passage when funds
are received or when their account falls below a certain level. Although people do not
expect much from the Internet these days, this will change in the future, and online
systems may fulfill customers' needs in even more sophisticated ways.
Questions
1. What is special about the operation of First National bank?
It is run entirely through the telephone and the Internet.
2. What quality do they look for when recruiting a new employee?

They only recruit people who already exhibit good communication skills
3. Why does First National Bank refuse to use scripts?
Customers find scripts impersonal and unnatural.

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4. How can the staff establish good relationship with customers?

They have to recognize people's needs, pick up on the caller's mood and react
accordingly.
5. What does First National Bank do to offer services which meet customers' needs?
They offer a service in which customers receive a text when funds are received or
when their account falls below a certain level.

NEW CUSTOMERS ONLY
Banks always want to get new customers and so they make attractive offers: new
customers can get higher interest rates on savings accounts for the first six months, there
are no arrangement fees on new mortgages, and people who open a new current account
get a free gift. However, these special offers are usually limited to "new customers
only" - which often appears in the small print at the bottom of their advertisements and
makes existing customers angry. Why are all the best products, the best interest rates for
"new customers only'?
In a TV advertisement for the Nationwide Building Society in the UK, an existing
customer goes into a bank and asks for several of the attractive products and services
the bank offers. Each time, the bank employee tells him he can't have what he wants
because it is for "new customers only'. He leaves the bank and goes to the Nationwide
Building Society where the special offers are for all customers. This advertisement
suggests that banks need to take customer care seriously and treat all customers the same.
The clever business strategy is not just to attract new customers, but to keep the ones
you already have.
Questions
1. Why do banks make attractive offers?
to get new customers.
2. Where can people see the words "new customers only" advertised by banks?
in the small print at the bottom of their advertisement.
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3. How do existing customers react when they can't get the offers?
They become angry
4. Why does an existing customer go to the Nationwide Building Society?

He goes to the Nationwide Building Society to get the special offers for all customers.
5. What is the clever business strategy?

It is to attract new customers and keep existing customers we already have.
The way in which a bank is organised and operates is determined by its objectives
and by the type of economy in which it conducts its business. A bank may not
necessarily be in business to make a profit. Central banks, for example, provide a
country with a number of services, while development banks exist to increase the
economic growth of a country and raise the living standard of its population. On the
other hand, the aim of commercial banks is to earn profits. They therefore provide and
develop services that can be sold at a price that will make a profit.
Many banks offer a combination of wholesale and retail banking. The wholesale
banking provides large-scale services to companies, government agencies and other
banks. The latter mainly provides smaller-scale services to the general public. Both
types of banking, however, have three essential functions, including deposits, payments,
and credits. These three functions are the basis of the services offered by banks. They
make it possible for banks to generate profits and to achieve their operating aims.
Recently banks have started to offer many new facilities to their customers such
as cheque cards, cash cards, credit cards, insurance cover, and investment services.
However, one of the most important services which banks offer is that they lend money
to their customers. The methods available for a customer to borrow and the rates of
interest vary from country to country and bank to bank.
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Questions
1. What does a bank organization and operation depend on?
its objectives and the type of economy in which it conducts its business.
2. What are two aims of development banks?

to increase the economic growth of a country and raise the living standard of its
population.
3. What are the similarities between wholesale and retail banking?
They both have three essential functions, including deposits, payments, and credits.
4. Why are these three functions very important for bank operation?
They make it possible for banks to generate profits and to achieve their operating
aims.
5. What are some new facilities offered by banks?
cheque cards, cash cards, credit cards, insurance cover, investment services
Recently banks have started to offer many new facilities to their customers. There
are new types of accounts, cheque cards, cash cards, credit cards, insurance cover,
investment services. However, one of the most important services banks offer is that
they lend money to their customers. The methods available for a customer to borrow
and the rate of interest vary from country to country and bank to bank.
One way of borrowing is to overdraw on your account. This is useful if you only
wish to borrow a small amount for a short time. The interest rate on overdrafts depends
upon the bank rate. In the UK, at the moment it is 12 % over base rate. You can only
have an overdraft with your manager's permission.
Another way is to arrange a 'personal loan' . A personal loan is for a fixed period
of time usually 3-5years. Many people take out a personal loan, for example, to buy a
car. Each month the customer makes a payment on the loan to the bank. The main
advantage of a personal loan is that the interest rate is fixed. In the U. K. at the moment
it is 19 %. Of course, for both a personal loan and a long-term loan the bank requires
some kinds of security e.g., shares.
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Questions
1. What facilities have banks started to offer their customers?
new types of accounts, cheque cards, cash cards, credit cards, Insurance
cover, investment services.
2. When is it useful to overdraw on the account?
When we wish to borrow a small amount for a short time.
3. According to the text, what is the requirement to have an overdraft?

You can only have an overdraft with your manager's permission.
4. What does the customer have to do every month when he takes out a personal
loan?
Each month the customer makes a payment on the loan to the bank.
5. According to the text, what is the requirement to take out a personal loan?
The bank requires some kind of security e. g., shares.
What makes money valuable? You could say there is no reason. It's true that a
special kind of paper is used to make dollar bills, and they are pretty, but that's not what
makes them valuable. The real reason why money is valuable is that everyone believes
it is.
Ancient economies had no paper money or coins. Some used barter - trading
one thing for another. Others used objects as money. Animals or metals were popular,
and so were manufactured products like jewelry or weapons. Wealth in ancient Greece
was measured in tools or cattle. This kind of money had two purposes. First, it was
useful because tools and cattle can be used for farming. Second, it was a way to
symbolize and measure value. A house, for example, would be valued at a certain
number of tools or cattle. Other societies used money that was totally symbolic. For
instance, American Indians used wampum, which is made from seashells. And until
recently on the Pacific island of Yap, people used large stone discs as money.
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In most places, these types of money no longer exist since more practical forms
of money were invented. People started using precious metals such as gold and silver
because they were easier to carry around. In the eighteenth century, paper money was
introduced. At first people were suspicious of the new currency, but they came to accept
it because the government or bank issuing it would exchange an equal amount of gold
for the paper. Nowadays, people are used to the idea that the government doesn't have
to back its money with gold. But if, for some reason, people ever lost faith in paper
money, ten dollars wouldn't be worth the paper it's printed on.
Questions
1. According to the text, why is money valuable?
Because everyone believes it is
2. What objects were used as money in ancient Greece?

tools and cattle.
3. Where are large stone discs used as money?

on the Pacific island of Yap.
4. Why were gold and silver used as money?

They were easier to carry around.
5. Why did people accept paper money?

Because the government or bank issuing it would exchange an equal amount of gold
for the paper.
Corporate customers who want to borrow large amounts of money come to the
Corporate Banking Department in our bank. They have to have a good credit rating and
collateral if they want to arrange a loan. This can be land or other assets. They should
bring along all their financial documents like the income statement, balance sheet and
cash flow statement. The corporate banker will look at their current assets and non-
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current assets to see what the company owns. Then the banker will look at the liabilities
to see how much the company owes. He or she will also look at the shareholders' equity
to see how much money has been invested in the company by selling shares. It is also
important to see the retained earnings. This is the money the company uses for their
business or to pay debts.
The banker will also want to see the income statement. This shows the bank how
much the company earned and what they spent in a period of time. If the operating
revenues were higher than their operating expenses, they made a profit. But if the
operating revenues were lower, they made a loss. He or she will also look at the net
profit or how much the company kept after paying all the expenses.
Finally, the banker will look at the cash flow statement. This is where he or she
can see if the company has generated cash in the last year. This statement shows how
money comes in and goes out of the company. It is very important for the bank as it
shows if the company can pay its bills.
Questions
1. What are two things that a company needs if it wants to arrange a loan?
good credit rating and collateral.
2. What does the shareholders' equity show?

It shows how much money has been invested in the company by selling shares.
3. What do companies use their retained earnings for?

This is the money the company uses for their business or to pay debts.
4. What does a bank find out by looking at the income statement?

This shows the bank how much the company earned and what they spent in a period
of time.
5. Why is the cash flow statement important for the bank?
It shows if the company can pay its bills.
Prepaid credit cards provide an alternative to all those people that need a credit
card. They work much like debit cards, that is an account set up by a monetary deposit,
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and this deposited money can be used up through the prepaid credit card issued. The
greatest advantage of prepaid credit cards over normal credit cards is that you are entitled
to spend only as much as you have in your account - thus you will not be in debt, and
you will have no bill to pay. One disadvantage of prepaid credit cards, however, is that
most prepaid credit card companies require a set-up fee to both open and maintain the
prepaid credit card account. You will be required to pay taxes on your cash deposits,
and you may be required to pay an annual membership fee. Another major disadvantage
is that most online merchants do not accept prepaid credit cards as payment. This is
because they have no guarantees that the account can completely cover payment for an
online purchase. This can be difficult for prepaid credit card holders to pay for monthly
subscriptions to Internet service providers or to purchase items that are sold at zero
percent interest. If you are interested in purchasing and using a prepaid credit card, take
note of these advantages and disadvantages. Although you have the convenience of not
carrying cash, you may not be able to purchase as many items as you wish, or from as
many merchants as you please. Although you may have to pay additional fees for your
account, you can control your overall spending and keep yourself out of debt.
Questions
1. In what way are prepaid credit cards similar to debit cards?
It is an account is set up by a monetary deposit, and this deposited money can be used
up through the prepaid credit card issued.
2. Why are prepaid credit cards better than credit cards?
Customers can spend only as much as they have in their account - thus they will not
be in debt, and will have no bill to pay.
3. What is a set-up fee used for?
to open and maintain the prepaid credit card account.
4. Besides the set-up fee, what are some additional fees will customers have to pay
for prepaid credit cards?
taxes on cash deposits, and annual membership fee.
5. Why do most online merchants reject prepaid credit cards?

They have no guarantees that the account can completely cover payment for an online
purchase.
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Banks are financial institutions that accept deposits from citizens and pay interest
in return. However, banks are not all service institutions, most banks operate in order to
make a profit. Even if they are a non-profit organization, they have to make money in
their operation in order to pay expenses. Banks do this in a variety of ways.
First, they charge interest on loans from their depositors and from the government.
They pay interest to depositors but charge a higher rate on money they lend out. For
example, a bank may pay 3% on a savings account but charge 9.5% in interest on a loan.
In the case of money borrowed from the government, banks pay a percentage rate on
money they borrow, which is called the discount rate. Banks then lend that money and
charge a higher rate on the loan than the rate that they pay. It's called using other
people's money!
Second, banks use depositors' money to make money. They do this by giving
loans and earning interest. These loans are usually real estate loans, sometimes they are
car loans, student loans, etc. Some banks make commercial real estate loans, others do
not. Recently, there have been the mergers between banks and investment institutions.
They do this so that they could step into rather dangerous business areas of investing
and being connected to the stock market.
Third, banks charge fees. Today banks have fees for minimum deposit, per check
fees and ATM fees. When ATMs were first introduced, they were supposed to replace
bank branches, save banks operating expense and that savings would be passed on to
consumers. However, this has not happened. Instead, ATMs have become a revenue
source for banks as they charge up to $1.50 per transaction. If you use the ATM of a
bank other than your own, both your bank as well as the ATM Ds bank may charge you a
fee.
Questions
1. Why do banks have to make money?
to pay expenses.
2. How do banks make money by charging on loans from their depositors?

They pay interest to depositors but charge a higher rate on money they lend out.
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3. How do banks make a profit from depositors' money?

They do this by giving loans and earning interest.
4. Why do some banks merge with investment institutions?

to step into rather dangerous business areas of investing and being connected to the
stock market.
5. What were the original purposes of ATMs?
They were supposed to replace bank branches, save banks operating expense and that
savings would be passed on to consumers
THE STOCK MARKET
The stock market is a financial institution where brokers trade company stocks
and other securities physically (in real life) or virtually (on the Internet).
Common Stock Market Terms
• Primary Stock Market: this market is for trading ofInitial Public Offerings (IPOs) and
other brand-new issues by sellers and buyers
• Secondary Stock Market: this market is for trading of existing stocks in the market by
buyers and sellers
• Stock price: This is the value for which stocks are bought and sold. Factor that directly
impacts on stock prices is the performance of company issuing the stocks. Another
factor is the market capitalization which is the stock price multiplied by the number of
shares. Other factors that affect stock prices include the expansion and future growth.
• Dividend yield: The dividend yield is calculated by dividing the annual dividends per
share by the price per share. This dividend yield means that the shareholder has a return
on his dividends.
• Bulls and bears: You have a bull market when the values of stocks go up. This shows
the good health in the economy. In a bull market, investors can gain a lot of profits from
stock sales. In contrast, bear market indicates an economic downtrend so that investors
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need to sell their stocks before the prices drop much lower. During a bear market, a lot
of investors and businesses might lose a lot of money if they are not quick in buying
good stocks and selling bad shares before they plummet. The general rule to follow in
the stock market is to buy when prices are low and sell when prices are high.
Questions
1. What are the two (2) ways in which exchanges in stock market occur?
physically (in real life) or virtually (on the Internet).
2. In what market can we buy the existing stocks or shares?

Secondary Stock Market.
3. What is market capitalization?
It is the stock price multiplied by the number of shares.
4. How is the dividend yield calculated?
The dividend yield is calculated by dividing the annual dividends per share by the
price per share.
5. What might happen to the investors in a bull market?
Investors can gain a lot of profits from stock sales
There are many ways to invest in shares. Before you invest, you should understand
the benefits and risks of each option and decide which method suits your needs. Some
of them are as follows:
1. Buying individual shares directly
You can buy individual shares through a full-service broker, an online trading
account or from the company itself when it offers shares through a public float. You
have control over the shares you buy and sell. However, you must be prepared to put in
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the time and effort to track their performance and watch the market to make your own
buy or sell decisions.
2. Buying shares via a Listed Investment Company (LIC)
A listed investment company uses money from investors to invest in a range of
companies and other assets. It pays you dividends from its earnings and hopefully its
shares increase in value over time. LICs often have lower ongoing costs than managed
funds but a LIC Ds share price may not exactly reflect the alue of its investments.
3. Buying shares via an Exchange Traded Fund (ETF)
An Exchange Traded Fund (ETF) invests in a basket of shares that make up an
index, e.g. the ASX200 Index. An ETF allows you to diversify your portfolio without
having a large amount of money to invest. You can buy or sell ETFs just like any other
share. But they may be less suitable if you are investing small amounts regularly, due to
a stock broking fee on each contribution.
Questions
1. What are three (3) ways in which investors can buy individual shares directly?
through a full service broker, an online trading account or from the company.
2. What is the advantage of buying individual shares directly?

You have control over the shares you buy and sell.
3. What is the disadvantage of buying individual shares directly?

You must be prepared to put in the time and effort to track their performance and
watch the market to make your own buy or sell decisions
4. What is the advantage of buying shares of a Listed Investment Company?
LICs often have lower ongoing costs than managed funds.
5. What is the disadvantage of buying shares via an ETF?
They may be less suitable if you are investing small amounts regularly, due to a stock
broking fee on each contribution.
Banking began in the twelfth century in Italy. Moneylenders set up benches in
the marketplace to do transactions. In the UK retail banking started in the seventeenth
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century. People began to use banks to keep their gold and silver safe. The bank gave
them receipts, and customers used these as currency. Today many of the early banks
have expanded into financial supermarkets for customers. They offer current and deposit
accounts and make payments through EFTPOS (electronic funds transfer at point of sale)
in shops and restaurants. In addition, they issue credit cards, pre-paid cards, debit cards
and smart cards. Many banks even give financial advice and sell insurance and pension
plans.
Nowadays, the methods of banking have changed a lot. People used to use
cheques widely. Today most customers use direct debits or standing orders to pay their
bills. Many customers open online accounts. This means that they no longer have to
come into the bank. And when they do, they usually use the machines in the lobby and
they donDt speak with a banker at all. Therefore, it is much more difficult today for
bankers to get to know their customers. It is also harder to advise them or sell them other
products.
This is why banks have come up with other ways to meet their customers. World
Savings Day was started in 1924 in Milan, Italy but is now expanding to countries where
people sometimes donDt use banks at all. The banks give their customers gifts for opening
savings accounts. Sometimes they hold events and invite customers to come to them to
hear about investments or other financial topics. Today many banks have become larger
and have merged with other banks. Customers no longer know the people that they deal
with. That is one reason why banks are trying to find new ways to win customers.
Questions
1. How did banking work in the twelfth century in Italy?
Moneylenders set up benches in the marketplace to do transactions.
2. Why did people in the UK begin to use banks?

to keep their gold and silver safe.
3. What do people generally use to pay their bills instead of cheques?

direct debits or standing orders.
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4. Why it is much more difficult today for bankers to get to know their customers?
Customers usually use the machines in the lobby and they don't speak with a banker.
5. Why do some banks hold events?
They invite customers to come to them to hear about investments or other financial
topics/ to meet customers/ to win customers.
For tens of millions of Americans, banks are the first choice for savmg,
borrowing, and investing. Banking has changed in many ways through the years. Banks
today offer a wider range of products and services than ever before, and deliver them
faster and more efficiently. But bankingD s central function remains as it has always been.
Banks put a communityDs surplus funds (deposits and inestments) to work by lending
to people to buy homes and cars, to start and expand businesses, to put their children
through college, and for countless other purposes. Banks are vital to the health of the
nationD s economy.
During the last 25 years, banking has undergone a revolution. Technology has
transformed the way Americans obtain financial services. Telephone banking, debit and
credit cards, and automatic teller machines are commonplace, and electronic money and
banking are evolving. The techniques of bank examination have changed, too. Today
OCC examiners (the Office of the Controller of the Currency) use computers and
technology to help ensure that the banks they supervise understand and control the risks
of the complex new world of financial services.
The OCC supervises national banks and enforces federal banking laws. It rules
on new charter and merger applications for national banks, and conducts basic research
on banking and the economy. The tools have changed, but for the OCC, the basic
mission remains the same as in the days of Lincoln: to ensure a safe, sound, and
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competitive national banking system that supports the citizens, communities, and
economy of the United States.
Questions
1. Why do Americans need banks?
for saving, borrowing, and investing
2. How do banks use communityDs surplus funds to make a profit?

by lending to people.
3. For what purpose do oee examiners use technology in banking?

to help ensure that the banks they supervise understand and control the risks of the
complex new world of financial services
4. How does oee supervise national banks and enforce federal banking laws?
The GCC rules on new charter and merger applications for national banks, and
conducts basic research on banking and the economy.
5. What is the basic mission of Oee?
to ensure a safe, sound, and competitive national banking system that supports the
citizens, communities, and economy of the United States
Point of Sale (POS) system is a system for managing the sales of retail goods.
The term is used to refer to the software and hardware associated with check-out stands,
and all of the bundled features which are included. Most retailers use a POS system at
their check-stands, and several major manufacturers offer POS systems designed for
various types of businesses, ranging from grocery stores to clothing boutiques. Using a
POS system makes a business much more efficient, lowering the costs of running the
business while improving customer service and making the business more pleasant to
work in. In the retail trade, the "point of sale" is the moment when a customer walks up
to a counter with goods and prepares to purchase them.
The most basic POS computer system is an electronic cash register. The clerk
can ring up goods in the cash register and produce a receipt for the customer. At the end
of the day, various cash register functions can be used to print out daily reports which
are used to reconcile the cash register and to prepare a deposit. More complex cash
registers are capable of extremely detailed reports, and they have memory functions
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which allow users to look up reports from the past, or generate monthly and yearly
reports.
A more complex POS system, however, includes numerous bundled features.
Many POS systems have inventory management capabilities, where each piece of
merchandise is entered into the system so that it can be tracked. Some systems also allow
store buyers to generate purchase orders from within the system, using data about sales
and product popularity. Time clocks and other accounting features such as credit card
verification may be integrated into a POS system as well.
The hardware of a POS system is also distinctive and important. A typical system
includes a display screen for the clerk, a customer display, a cash drawer, a credit card
swiping system, a printer, and a bar code scanner, along with the computer loaded with
the POS software.
Questions
1. What does the acronym POS stand for?
It stands for Point of Sale.
2. What does the term POS system refer to?

They are the software and hardware associated with check-out stands, and all of the
bundled features which are included.
3. What are the advantages of POS system for the businesses?
They become more efficient: lowering the costs of running the business, improving
customer service, and making the business more pleasant to work in
4. What are the functions of the cash register in the POS system?
At the end of the day, the cash register can print out daily reports. With complex cash
registers, users can look up reports from the past, or generate monthly and yearly reports.
5. What are necessary devices for the system to be used?
A display screen for the clerk, a customer display, a cash drawer, a credit card swiping
system, a printer, and a bar code scanner, along with the computer loaded with the POS
software.
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Exercise 1: Translate the following sentences into \'ietn8lllese.

1. Corporate financiers are viewing China as one of the next big investment
opportunities.
2. It is easier for potential investors to make investment decisions about a business

which is already running.
3. Investors in start-up companies will not invest in risky ventures however

profitable they might potentially be.
4. We think that this company looks particularly promising because it claims a very
high internal rate of return.
5. After an unsuccessful year, we expect to see their sales hit the fast-growth curve
very soon.
6. Porsche had been making a larger profit out of option trading than it has out of
selling cars.
7. In 2008, the UK experienced a credit crunch when people found it more difficult
to get a loan from a bank.
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8. This company had adopted a very aggressive funding model which left it very
vulnerable when the credit crunch hit.
9. This bank had relied too heavily on wholesale funding and not enough on retail
deposits.
10. What was first believed to be a short credit crunch had turned into a more serious
recession.
Exercise 2: Translate the following sentences into Vietnamese.

1. Investment means using money to buy an asset with the aim of making a profit
by selling that asset at a higher price in the future.
2. China has tried to control its manufacturing costs through outbound acquisition.
3. Foreign investment banks are seeking to acquire stakes in domestic securities

firms in order to be able to trade local stocks.
4. Entrepreneurs can attract investors by demonstrating that they understand the risk
factors, and presenting a persuasive business plan.
88
5. The success of a start-up depends on how well an entrepreneurDs business plan

takes into account the needs of a potential investor.
6. Every company in a portfolio needs to give a potentially high return, because the
winners will eventually have to cover the losers.
7. The Central bank suffered from criticism for its failure to foresee the
consequences of the US subprime mortgage lending crisis.
8. Corporate credit-rating agencies assess the creditworthiness of bonds and bond

Issuers.
9. Investors use the information of corporate credit-rating agencies to assess the

potential return on investment.
10. These credit-rating agencies were criticised because they earned a fee from the
issuers whose securities they rated.
89
Exercise 3: Translate the following sentences into Vietn8llle8e.

1. In 2007, the US government listed seven credit-rating agencies as nationally
recognised statistical rating organisations.
2. The market watchdogs started questioning the roles of the rating agencies in the
subprime mortgage crisis.
3. The credit rating agencies said that their job was to provide an opinion on the
probability of a company defaulting on its debt repayments.
4. The rating agencies said that their ratings should never be used as the sole reason
for an investment decision.
5. In Britain, shares of public limited company are freely traded with a minimum
share capital of £50,000.
6. This accountant has recently warned me that his business is unlikely to be able
to survive much longer.
7. I am worried about my legal responsibilities and my financial liabilities if the

business becomes insolvent.
90
8. The directors need to act carefully to avoid the business trading insolvency,
because the penalties for doing this can be severe.
9. Penalties for insolvency may include disqualification of a company director or

even imprisonment.
IO.In case of insolvency, the interests of the company's creditors must become a
priority.
Exercise 4: Translate the following sentences Into Vietnamese.

1. The directors must understand the company's current financial situation and
assess the prospects for its future viability.
2. The directors have to know the latest transactions and management accounts
based on the company's latest order book.
3. They need to take independent professional advice from a specialist or licensed

insolvency practitioner.
91
4. We need to ensure that the assets of the company are always protected and not
sold for less than their real value.
5. I want them to make sure that they do not take on lines of credit that the company
cannot repay.
6. He must show at all times that he is acting in the best interests of all of the
company's existing creditors.
7. The CEOs should hold regular meetings and keep minutes of the discussions and
the key decisions they make.
8. As soon as their business becomes insolvent, the directors need to act quickly to
seek the protection with the insolvency procedure.
9. A licensed insolvency practitioner can help the company directors follow the
most suitable procedure.
10. When economic conditions become difficult, businesses can experience a sharp
downturn in trading.
92
Exercise 5: Translate the following sentences into Vietn8llle8e.

1. When a company cannot pay its creditors, it is called "insolvency".
2. The company stopped trading, and its assets were sold to payoff its creditors.
3. After an investigation, their dealings were found to be fraudulent.
4. Finally, the directors were subject to severe remedies and they went to prison.
5. It was discovered that some important items in their meetings had not been
written down in the minutes.
6. They had entered false items into their order book to make their business look
more successful than it actually was.
7. Retail banks receive deposits from, and make loans to, individuals and small
companies.
8. Commercial banks give financial advice, raise capital by issuing stocks or bonds,
and arrange mergers and takeovers.
93
9. Commercial banks generally offer stockbroking and portfolio management

services to corporate and rich clients.
10. Hedge funds use a variety of risky investing strategies in order to achieve high
returns.
Exercise 6: Translate the following sentences Into \'ietnaJllese.

1. There were regulations in the US, Britain and Japan that prevented commercial
banks from doing investment businesses.
2. Nowadays, large banks have become international conglomerates offering a

complete range of financial services.
3. Islamic banks do not pay interest to depositors, but invest in companies and share
the profits or losses with their depositors.
4. Some food retailers and department stores now offer products like personal loans,
credit cards and insurance.
94
5. The subprime borrowers are those with poor credit ratings and a high risk of
default.
6. During the housing crisis, many banks in the USA went bankrupt, and others had
to be rescued by governments.
7. A major bank has been rescued by the government after losing billions of euros
on speculative investments.
8. Companies finance most of their activities by way of internally generated cash

flows.
9. If a company needs to raise more money to expand their operations, they can
either issue new shares or borrow money.
10. Bondholders get back their principal on a fixed maturity date, and receive coupon
at regular intervals.
95
Vartli
WI2ITI~t3
96
Exercise 1: Make meaningful sentences by adding between 8 and 15 words to

the given phrases.
1. Many international banks in Vietnam .
2. Vietnam has been very active in .
3. Many investors are interested in .
4. Since the early 21st century, many foreign investments .
5. These days, Vietnamese investors would like .
6. It is predicted that in the next year .
7. Recently, many foreign investment banks have .
8. Vietnamese consumers now .
9. Many banks try to attract more customers by .
10. Vietcombank is trying to satisfy their customers by providing .

the given phrases.
1. One benefit of overseas investment is .
2. Many foreign companies like to invest in Vietnam because .
3. One disadvantage of overseas investment is .
4. Entrepreneurs can raise capital by .
5. Most entrepreneurs have difficulty in .
6. A start-up company needs to .
7. The success of a start-up company depends on .
8. When investors invest in a company, they .
9. This start-up company did not success because .
10. Last year, many start-up companies .
97

the given phrases.
1. We think this start-up company is promising because .
2. That company had a .
3. He refused to invest in that start-up because .
4. If the company succeeds, .
5. Our company could make .
6. During recession, many Vietnamese companies .
7. If you want to borrow money, you .
8. If the borrower cannot repay a loan .
9. If you want to work for an international company, you should .
10. The difference between central banks and commercial banks are .

the given phrases.
1. If you want to work as a broker, you can .
2. The share price of this company went down because .
3. This building society can .
4. If you have financial problems, .
5. Many economists believe that .
6. Our investors are confident that .
7. Currently, our bank focuses on .
8. The credit rating of our company is .
9. The Central bank .
10. Their company went bankrupt last year .
98

the given phrases.
1. Because of the recession, my company .
2. If your company is having financial problems, .
3. As a CEO, you should .
4. I am responsible for .
5. When economic conditions become difficult, .
6. That company stopped trading, and .
7. Although the director tried his best to protect the company, .
8. This company did not succeed because .
9. This bank refused to lend him the money because .
10. Our company needs .

the given phrases.
1. If this company needs money, it can .
2. If you want to pay for regular bills, .
3. Online banking is becoming popular because .
4. Last year, this commercial bank .
5. The employees in this bank are happy to hear that .
6. Because today is his first day as a banker, .
7. Banks are making some changes .
8. Companies are prepared to .
9. Peter would like to borrow some money to buy a house .
10. I think bonds are good because .
99

the given phrases.
1. That company intends to issue more shares .
2. Our bank has become more popular recently because .
3. If you have money to invest, .
4. If you have money to invest in bonds, .
5. The stock price of our company is rising, so .
6. The stock market in Vietnam .
7. After I had invested all his money into the stock market, .
8. I decided to open my account in this bank because .
9. I do not like that bank very much because .
10. I like to use credit cards because .

the given phrases.
1. When we do online shopping, we .
2. All banking services nowadays .
3. He was happy to hear that the stock price of his company .
4. If you invest in the stock market, remember .
5. The banks can help us .
6. That ATM is .
7. In order to open an account in our bank, you need to .
8. I work in the bank and I help customers .
9. As a bank teller, you should .
10. The services at this bank .
100
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101
M()()UL~1: I3N11inllllit7
PART 1.VOCABULARY
1.1. Multiple choice
lA 2B 3B 4D 5C
1.2. Matching
lC 2B 3E 4D 5A
PART 2. CLOZE PASSAGES

2.1 Passage 1
1. capital
2. loan
3. back
4. money
5. certificates
6. shareholders
7. institutions
8. interest
2.2 Passage 2
1. bank
2. lender
3. borrower
4. repayment
5. bond
102
6. investor
7. interest
8. securitised

3.1 Reading passage 1
1. Investment banks act as intermediaries between companies and investors.
2. They raise capital by issuing securities such as stocks and bonds
3. They can sell stocks or shares to institutional investors
4. This executes orders - buys and sells stocks for clients - which is broking, and trades
with our own money, which is dealing. The stockbroking department also offers advice
to investors

1. Bank payment must be sought at the branch where the account is, and during business
hours.
2.The Barclays Bank led the way in opening some major branches on a Saturday
morning for limited personal services.
3. One of the earliest cash dispensers consisted of a safe let into the outer wall of the
bank and containing packets of £ lOin £ 1 notes.
4. When the cash card electronic checking was satisfactory.
PART 4. TRANSLATION
4.1 English - Vietnamese translation
l.Cac ngan hang ban le hoac ngan hang thirong mai nhan tien giri, va cho vay toi cac ca
nhan va cong ty nho.
103
2.Vi~c tang Eii suatchi di~n ra a nhirng ngan hang quy mo nho va khong phan anh duoc
xu huang chung cua toan b9 h~ thong ngan hang.
3. Cac ngan hang Ion da tro thanh nhirng t~p dean da quoc gia cung c~p mot h~ thong
d~y du cac dich vu tai chinh rna tnroc day da duoc tlnrc hien boi ngan hang, quy phong
h9 va cac cong ty bao hiem,
4. U6i voi cac ngan hang, khach hang khong con c~n giir mot khoang Ian tien m~t trong
tay; nhirng giao dich thay vao d6 c6 th~ thirc hien b&ng sec, the ghi no hoac the tin dung,
5. T6 chirc tai chinh la mot co sa thirc hien cac giao dich tai chinh nhu la d~u tir, cho
vay va nhan tien giri,
4.2 Vietnamese - English translation

1. Investment banks work with big companies, giving financial advice, raising capital
by issuing stocks and bonds.
2. Some retail banks are international corporations with numerous branch banks all over
the world.
3. Thanks to technology, we can shop online, communicate online, we can even do our
banking online.
4. After gaining work experience in a bank, many people take staff development courses
in banking procedures, lending, or investing.
5. A joint account is considered to be riskier than two separate accounts, but many
people find that pooling income into a common account makes bill paying easier.
PART 5. WRITING
1.Subprime borrowers are those with poor credit ratings and consequendya high risk of
default
2. Securitization means pooling financial assets like morgages and converting into
securities.
104
3. When many subprime borrowers stopped paying, the value of subprime related
securities feU dramatically.
4. The credit crunch happens when there is a massive reduction in the credit available for
banks to lend to other banks, and businesses.
5. N on- bank financial intermediaries also offer products like personal loans, credit cards
and insurance.
M()I)UL~~ OO!llliI)
PART 1. VOCABULARY
1.1. Multiple choice
1D 2D 3B 4C 5B
1.2. Matching
1B 2C 3A 4E 5D

2.1 Passage 1
1. debt
2. issued
3. raise
4. bond
5. repay
6. maturity
7. taxable
8. ownership
2.2 Passage 2
1. bankruptcy
2. bondholders
105
3. payments
4. liquidation
5. reserves
6. profits
7. cash flow

1.4 types.
2. The federal government.
3. Government Sponsored Enterprise.
4. to provide funding for the federal mortgage, education and agricultural lending
programs.

1. Regulators.
2. Hedge funds are less regulated and can engage in a broader range of trading activities.
3. The number of investors is restricted.
4. Always making a profit whether the markets move up or down.
PART 4. TRANSLATION
1. N~u ho c~n huy dong nhieu tien hon d~ mo rong hoat d9ng cua minh, ho co th~ phat
hanh c6 phieu moi hoac b&ng each mUQl1tien, thong tlnrong b&ng viec phat hanh trai
phieu,
2. U6i voi cac nha d~u tu, trai phieu noi chung la an toan hon c6 phieu boi vi neu mot
cong ty va no hoac pha san ban tai san cua no, trai chu la mot trong nhirng chu no rna
co th~ l~y lai mot phan tien cua ho,
106
3. N~u khoan thu til thu~ khong du, chinh phu ciing phat hanh trai phieu d~ huy dong
v6n va di~u nay duoc xem nhu la mot SlJ d~u tu khong c6 rui roo
4. Chi nhirng trai tim dung cam moi nhin nhan vao viec quay tro lai thi tnrong clnrng
khoan vao hie nay, boi vi v~n khong ra rang rang lieu cluing ta c6 th~ d6i d~u voi mot
cuoc khung hoang hoac suy thoai toan c~u nira hay khong.
5. Quy nay lnrong toi viec dat duoc thu nhap cao va 6n dinh va 6' tren rmrc hoa loi trung
binh, trong khi v~n quan tam toi viec an toan cua nguon v6n d~u tu.

1. Government bonds are considered risk-free and are traded in highly liquid markets.
2. Certain government bonds restrict the dollar amount that may be purchased per
calendar year.
3. Corporate bonds allow the company to borrow money directly from individual and
institutional investors.
4. From the issuers' point of view, bonds are sometimes better than shares as the interests
paid to the bondholders are tax deductible.
5. The high-yield bonds offer attractive rates to lure investors. However, the investors
who choose carefully can earn quite decent money from these.
PART 5. WRITING
1. Bond holders can get back theiro.riginaJinvestment on s tised .maturitydate and receive
interest payments at regular intervals.
2. A company that wants to raise cash can either sell a share by issuing stock or take on
debt by issuing bonds.
3. The Primary Market is a securities exchange where new securities are issued to the
shareholders.
4. If a company goes bankrupt, bondholders can get some of their money back.
5. The yield of a bond depends on its purchase price as weDas its coupon.
107
M()I)UL~:I:ST()£N Nllil) S~~S

PART 1.VOCABULARY
1.1 Multiple choice
lA 2B 3D 4C 5D
1.2 Matching
lB 2D 3E 4C 5A

2.1 Passage 1
1. shares
2. stocks
3. certificates
4. public limited company
5. corporation
6. flotation
7. invesment
8. underwrite
2.2 Passage 2
1. due deligence report
2. prospectus
3. equity financing
4. debt financing
5. ordinary shares
6. common stocks
7. bonds
8. shareholders
108

1. Investors and the publici Almost everyone
2. Returns paid on pensions, savings accounts, interest charged on mortgages
3. They issue new shares.
4. Cut jobs

1. They are only liable for the amount of capital that has been invented in the limited
company, so they don't have to sell their possessions to pay the debts.
2. When a company goes bankrupt, if the assets don't cover the liabilities or the debts,
they may not get all their money back.
3. It is the market for newer and smaller companies.
4. They have to fulfill a large number of requirements, including sending their
shareholders an independently audit report every year, containing the year's trading
results and a statement of their financial position.
PART 4. TRANSLATION
1. Cac cong ty sir dung ngan hang d~u tu d~ tim kiem ngiroi mua, va d~ bao lanh SlJ phat
hanh c6 phieu,
2. Cac cong ty c6 th~ phan ph6i mot phan 19i nhuan cua ho cho cac c6 dong nhu la c6
nrc hang nam.
3. Lam sao ban c6 th~ kiem duoc ti~n til thi tnrong clnrng khoan dang di xuong?
4. Sau khi tang manh vao tu~n tnroc, clnrng khoan chan A dil xuong dec do SlJ so hili v~
mot cuoc suy thoai kinh hoang,
109
5. H~u h~t cac c6 phieu da tang kha manh a Madrid vao sang nay, sau khi san clnrng
khoan mo cira tro lai sau ngay nghi l~ truyen thong hom qua.

1. Public companies are publicly traded within the open market with shares being
purchased by a variety of investors.
2. Most public companies were originally private companies that met all of the
regulatory requirements.
3. Public companies have certain inherent advantages over private companies, including
the ability to sell future equity stakes and increased access to the debt markets.
4. Shareholders are the owners of the company so they expect the company to perform
effectively.
5. Start-ups will find it difficult to be listed on any securities exchanges because they
require the companies to be profitable to go public.
PART 5. WRITING
1. After shares have been issued, they can be traded on the secondary market
2. The rise and fall of stock prices depend on supply and demand or the market forces.
3. Blue chips are shares in weD-established companies with a good reputation for quality
and profitability.
4. A private company can go public by offering their stocks for sale to the finandal
institutions and the general public.
5. Hedge funds can "short" shares by borrowing them off a conventional lund and then
selling them.
110
PART 1.VOCABULARY
1.1 Multiple choice
lD 2A 3D 4C SA
1.2 Matching
lB 2E 3A 4D SC
Part 2. CLOZE PASSAGES

2.1 Passage 1
1. operations
2. fraud
3. institution
4. guarantee
S. transactions
6. vaults
7. procedures
8. performance
2.2 Passage 2
1. invoices
2. receipts
3. journals
4. ledgers
S. customer
6. figures
111
7. auditors
8. declare

1. There are seven accounting principles mentioned in the passage.
2. No it isn't.
3. Companies should understate rather than overstate profits.
4. They can know if an apparently profitable company has a non-profitable a subsidiary
with huge liabilities.

1. Part of the profit is paid to the government in taxation, part is usually distributed to
shareholders as a dividend, and part is retained by the company to finance further growth,
to repay debts, to allow for future losses, and so on.
2. It lists the company's assets, its liabilities and shareholders' funds
3. No, they can be intangible assets.
4. This statement shows the flow of cash in and out of the business between balance
sheet dates.
PART 4. TRANSLATION
1. o h~u h~t cac mroc cac cong ty ghi chep lai nguyen gia cua tai san - gia mua ban d~u
chir khong phai gia ban hien tai hoac gia thay the,
2. Ngoai ra, ban c6 th~ trinh bay cac tai khoan cua mot cong ty ban lam viec hoac da
tung lam viec hoac biet ro.
112
3. T~t ca s6 tien rna doanh nghiep chi cho hang h6a hoac dich vu trong mot thai ky nhdt
dinh la chi tieu.
4. Bang can d6i k~ toan la mot bao cao th~ hien gia tri tai san cua doanh nghiep, cac
khoan no phai tra va v6n hoac v6n chu So' hiru cua c6 dong.
5. Bao cao tai chinh cua Google sir dung cac thuat ngir cua My, doi khi khac voi cac
thuat ngir cua Anh.
4.2 Vietnamese -English translation

1. The income statement summarizes the revenues and expenses generated by the
company over the entire reporting period.
2. All companies need to generate revenue to stay in business. Revenues are used to pay
expenses, interest payments on debts and taxes owed to the government.
3. After the costs of doing business are paid, the amount left over is called net income.
4. A balance sheet is a formal document that follows a standard accounting format
showing the same categories of assets, liabilities and shareholder's equity.
5. The corporate cash flow statement reports the cash generated and used III the
following categories: operating activities, financing activities and investing activities.
PART 5. WRITING
1. The balance sheet reports the company's Iiaencisl condition on a specific date.
2. Bookkeepers and accountants are responsible for keeping records and providing
Iinsncisl information about the business.
3. Accounting principles applied by the companies v;uy Irom counuy to couatry:
4. The assets are listed on the Jeftside of the balance sheet
5. Tax accounting calculates how much a company wiDhave to pay to the Jocal and
national governments.
113
Exercise 1
lD 2A 3C 4E SB
Exercise 2
IE 2B 3D 4C SA
Exercise 3
lB 2D 3E 4C SA
Exercise 4
lA 2B 3E 4D SC
Exercise 5
IE 2C 3B 4D SA
Exercise 6
lB 2C 3A 4E SD
Exercise 7
1. global brands
2. corporate financiers
3. risk management
4. foreign investment
S. broke
Exercise 8
114
1. start-up
2. internal rate of return
3. magnitude
4. fast-growth curve
5. high return
Exercise 9
1. derivatives
2. options
3. blocking minority
4. short squeeze
5. position
Exercise 10
1. sharp downturn
2. fraudulent
3. remedies
4. disqualification
5. order book
Exercise 11
1. credit crunch
2. collapse
3. vulnerable
4. wholesale funding
5. loan exposure
115
V~T~.£LVZ~V~4~~
Passage 1
1. deposit
2. return
3. liquidity
4. withdraw
5. passbook
6. rate
7. surplus
8. maturity
Passage 2
1. financial
2. mortgage
3. arrangement
4. assess
5. corporate
6. raise
7. automatic
8. identification
Passage 3
1. insurances
2. head
3. trainees
4. cashiers
5. property
6. financial
116
7. transactions
8. transfers
Passage 4
1. shareholder
2. dividend
3. bonds
4. fixed
5. matures
6. mutual
7. return
8. earnings
Passage 5
1. representative
2. host
3. subsidiaries
4. provisions
5. parent
6. branches
7. control
8. participation
Passage 6
1. mortgage
2. ownership
3. collateral
4. supply
117
5. repayments
6. foreclose
7. fluctuation
8. standardized
Passage 7
1. restrain
2. functioning
3. signals
4. sustainable
5. cost
6. demand
7. pressures
8. loss
Passage 8
1. trainee
2. analyst
3. call centers
4. administrative
5. supervisors
6. fast-track
7. appraisal
8. pension
Passage 9
1. refund
2. denominations
3. currencies
118
4. obtain
5. debited
6. commissions
7. insurance
8. serial
Passage 10
1. difference
2. issue
3. credit limit
4. cash
5. cheques
6. statement
7. clear
8. outstanding
Passage 11
1. surprised
2. buyout
3. deal
4. target
5. objected
6. hostile
7. offer
8. sale
Passage 12
1. get
2. financed
119
3. called
4. paid
5. repaid
6. known
7. combined
8. provided
Passage 13
1. its
2. where
3. much
4. the
5. from
6.of
7. at
8. like
Passage 14
1. earns
2. writing
3. connected
4. give
5. lend
6. charging
7. offer
8. need
Passage 15
1. aim
120
2. owners
3. dividend
4. savings
5. terms
6. risk
7. capital
8. inflation
Passage 16
1. have
2. that
3. deposit
4. been
5. widely
6. present
7. found
8. evolved
Passage 17
1. for
2.of
3. because
4. over
5.on
6. from
7. if
8. which
121
Passage 18
1. returned
2. served
3. relations
4. sanctions
5. unemployment
6. crisis
7. democracies
8. negotiated
Passage 19
1. asset management
2. potential
3. physical
4. performance
5. examine
6. science
7. critical factors
8. realize
Passage 20
1. responsibility
2. annual report
3. supervision
4. risk management
5. default
6. retail
122
7. developed
8. expected
V~T~. ~UI)I,..t7 OOMV~HlDliSI(N

Reading passage 1
1/ investment banking and capital markets group
21 to reduce costs
31 "Project New BAC"
41 $5 billion in annual expenses
51 in May
Reading passage 2
1/ to save money, borrow money and to pay for things with ease and security
21 All central tasks are performed here.
31 They work behind the bank counter and help the customers.
41 They need to see the bank manager
51 Customers just need to carry a small plastic card to be able to pay for anything.
Reading passage 3
1/ Any 3 items out of the followings: receive and hold deposits, pay money according
to customers' instructions, lend money, offer investment advice, exchange foreign
currency, ...
21 They make a profit from the difference between the interest rates they pay to lenders
or depositors and those they charge to borrowers
31 The money they lend in bank account can be lent again to another debtor.
41 Bankers have to find a balance between yield and risk and between liquidity and
different maturities
51 US investment banks can only offer advisory services and do not offer loans
123
Reading passage 4
1/ It pays no interest.
2/ Customers do not have to carry a lot of cash.
3/ The branch manager has to decide whether the applicant is likely to keep the account
in credit.
4/ The manager wants to get the necessary background information.
5/ It is easier to open and earns interest for the customer.
Reading passage 5
1/ Any time/ 24 hours a day /Whenever it suits you.
2/ just a few seconds
3/ details of all your accounts and the business you have done over the years.
4/ the Society for Worldwide Interbank Financial Telecommunications
5/ It enables financial institutions to send and receive information about financial
Reading passage 6
1/ in order not to pay tax.
2/ He stole the details of more than 100,000 clients worldwide.
3/99.8% of French citizens on the list were probably evading tax.
4/ The bank fired her.! She was fired by the bank.
5/ Sue Shelley was responsible for making sure HSBC followed the law.
Reading passage 7
1/ the contact details and extra costs.
2/ At the bottom of the secure site, there is a small's' - which stands for' secure' - along
with a picture of a padlock.
124
31 We should keep copies of the order form and the acknowledgment notice that we
receive.
41 We should check the bank statement and read all the terms.
51 They advise us if we find that we have been cheated while shopping online
Reading passage 8
1/ It is run entirely through the telephone and the Internet.
21 They only recruit people who already exhibit good communication skills.
31 Customers find scripts impersonal and unnatural.
41 They have to recognize people's needs, pick up on the caller's mood and react
accordingly.
51 They offer a service in which customers receive a text when funds are received or
when their account falls below a certain level.
Reading passage 9
1/ to get new customers.
21 in the small print at the bottom of their advertisement.
31 They become angry.
41 He goes to the Nationwide Building Society to get the special offers for all customers.
51 It is to attract new customers and keep existing customers we already have.
Reading passage 10
1/ its objectives and the type of economy in which it conducts its business.
21 to increase the economic growth of a country and raise the living standard of its
population.
31 They both have three essential functions, including deposits, payments, and credits.
41 They make it possible for banks to generate profits and to achieve their operating
aims.
51 cheque cards, cash cards, credit cards, insurance cover, investment services.
125
Reading passage 11
1/ new types of accounts, cheque cards, cash cards, credit cards, Insurance cover,
investment services.
21 When we wish to borrow a small amount for a short time.
31 You can only have an overdraft with your manager's permission.
41 Each month the customer makes a payment on the loan to the bank.
51 The bank requires some kind of security e. g., shares.
Reading passage 12
1/ Because everyone believes it is.
21 tools and cattle.
31 on the Pacific island of Yap.
41 They were easier to carry around.
51 Because the government or bank issuing it would exchange an equal amount of gold
for the paper.
Reading passage 13
1/ good credit rating and collateral.
21 It shows how much money has been invested in the company by selling shares.
31 This is the money the company uses for their business or to pay debts.
41 This shows the bank how much the company earned and what they spent in a period
of time.
51 It shows if the company can pay its bills.
Reading passage 14
1/ It is an account is set up by a monetary deposit, and this deposited money can be used
up through the prepaid credit card issued.
126
2/ Customers can spend only as much as they have in their account - thus they will not
be in debt, and will have no bill to pay.
3/ to open and maintain the prepaid credit card account.
4/ taxes on cash deposits, and annual membership fee.
5/ They have no guarantees that the account can completely cover payment for an online
purchase.
Reading passage 15
11to pay expenses.
2/ They pay interest to depositors but charge a higher rate on money they lend out.
3/ They do this by giving loans and earning interest.
4/ to step into rather dangerous business areas of investing and being connected to the
stock market.
5/ They were supposed to replace bank branches, save banks operating expense and that
savings would be passed on to consumers
Reading passage 16
11physically (in real life) or virtually (on the Internet).
2/ Secondary Stock Market.
3/ It is the stock price multiplied by the number of shares.
4/ The dividend yield is calculated by dividing the annual dividends per share by the
price per share.
5/ Investors can gain a lot of profits from stock sales.
Reading passage 17
1Ithrough a full service broker, an online trading account or from the company.
2/ You have control over the shares you buy and sell.
3/ You must be prepared to put in the time and effort to track their performance and
watch the market to make your own buy or sell decisions
127
41 LICs often have lower ongoing costs than managed funds.
51 They may be less suitable if you are investing small amounts regularly, due to a stock
broking fee on each contribution
Reading passage 18
1/ Moneylenders set up benches in the marketplace to do transactions.
21 to keep their gold and silver safe.
31 direct debits or standing orders.
41 Customers usually use the machines in the lobby and they donDt speak with a banker.
51 They invite customers to come to them to hear about investments or other financial
topics.! to meet customersl to win customers.
Reading passage 19
1/ for saving, borrowing, and investing.
21 by lending to people.
31 to help ensure that the banks they supervise understand and control the risks of the
complex new world of financial services
41 The GCC rules on new charter and merger applications for national banks, and
conducts basic research on banking and the economy.

51 to ensure a safe, sound, and competitive national banking system that supports the
citizens, communities, and economy of the United States
Reading passage 20
1/ It stands for Point of Sale.
21 They are the software and hardware associated with check-out stands, and all of the
bundled features which are included.
31 They become more efficient: lowering the costs of running the business, improving
customer service, and making the business more pleasant to work in.
128
41 At the end of the day, the cash register can print out daily reports. With complex cash
registers, users can look up reports from the past, or generate monthly and yearly reports.
51 A display screen for the clerk, a customer display, a cash drawer, a credit card swiping
system, a printer, and a bar code scanner, along with the computer loaded with the POS
software.
Exercise 1
1. OlC cong ty tai chinh cho r&ng Trung Quoc la mot trong nhirng co hoi d~u tu Ian.
2. OlC nha d~u tu tiem nang d~ dang ra quyet dinh d~u tu han vao mot doanh nghiep khi
doanh nghiep nay dang hoat dong.
3. OlC nha d~u tu vao cong ty khoi nghiep se khong d~u tu v6n m:;1Ohiem cho du cong
ty c6 ti~m nang sinh loi th~ nao di chang nira,
4. Chung toi cho r&ng cong ty nay c6 kha nang d~y lura hen boi vi cong ty tv cho la se
t:;10ra ty su~t d~u tu cao.
5. Sau mot nam hoat d9ng khong thanh cong, cluing toi ky vong chang bao lau se dat
doanh s6 ban theo duong trim tang tnrong cao.
6. Cong ty xe hoi Porche da t:;10ra 19i nhuan Ian han til viec mua ban quyen chir khong
phai til viec ban san pham cua minh la xe hoi.
7. Vao nam 200S, mroc Anh da phai ap dung th~t chat tin dung khi ngiroi dan nhan ra
r&ngd~ yay mot khoan yay til ngan hang la r~t kh6 khan.
S. Cong ty nay da ap dung mo hinh nguon v6n khac nghiet d~ cong ty khong bi va no
khi th~t chat tin dung duoc ap dung,
9. Ngan hang nay da phu thuoc qua nhieu vao mang ban si va vi vay da khong c6 du
tien giri huy dong cho mang ban le.
1O. f)i~u rna moi ngiroi v6n cho la th~t chat tin dung trong ngan han da tro thanh viec
suy thoai nghiem trong han.
129
Exercise 2
1. f)~u tu co nghia la dung tien mua mot tai san nham muc dich t:;10loi nhuan khi ban
tai san do 6 mot rmrc gia cao han.
2. Trung quoc da c6 g~ng kiem soat chi phi san xuat qua viec thau tom ngoai mroc.
3. Cac ngan hang d~u tu mroc ngoai dang tim kiem nguon d~u tu thau tom cac chirng
khoan cua cac cong ty trong mroc nham muc dich giao dich mua ban clnrng khoan
trong mroc.
4. Cac cong ty khoi nghiep co th~ thu hut nha d~u tu mroc ngoai b&ng each clnrng minh
r&ng cac cong ty nay nam b~t duoc cac y~u t6 rui ro va dira ra duoc k~ hoach kinh
doanh thuyet phuc duoc nha d~u tu.
5. Su thanh cong cua cong ty khoi nghiep phu thuoc vao viec duoc nha d~u tu tiem nang
mroc ngoai quan tam d~n k~ hoach kinh doanh cua ho hay khong,
6. M9i cong ty trong danh muc d~u tu d~u phai co loi nhuan tiem nang cao boi vi cu6i
cung cong ty thanh cong se phai chi tra cho cac cong ty th~t bai,
7. Ngan hang trung irong bi chi trich vi da khong du dean tnroc duoc h~u qua cua khung
hoang trong cho vay diroi chuan 6 Hoa kyo
8. Cac t6 clnrc dinh gia rmrc tin nhiem cua cong ty se danh gia rmrc d9 tin c~y cua trai
phieu va cong ty phat hanh trai phieu,
9. Cac nha d~u tu sir dung thong tin cua t6 clnrc danh gia rmrc tin nhiem cong ty d~ danh
gia loi nhuan d~u tu tiem nang.
10. Cac t6 clnrc danh gia rmrc tin nhiem nay bi chi trich boi vi ho nhan tien phi cua
cac cong ty phat hanh chirng khoan rna ho danh gia.
Exercise 3
1. Vao nam 2007, chinh phu Hoa ky dira vao danh sach ten cua bay t6 clnrc danh gia
rmrc tin nhiem duoc cong nhan la t6 clnrc v~ s6 lieu thong ke rmrc tin nhiem cua
,
quoc gia.
130
2. Cac t6 chirc giam sat thi tnrong b~t d~u d~t cau hoi v~ vai tro cua cac t6 clnrc danh
gia rmrc tin nhiem khi c6 khung hoang cac khoan cho yay duoi chuan.
3. T6 clnrc danh gia rmrc tin nhiem cho r&ng cong viec cua minh la dira ra y kien v~
tinh kha di r&ngmot cong ty c6 th~ sai hen hoan tra no hay khong.
4. Cac cong ty danh gia mire tin nhiem nay cho r&ng y kien danh gia cua ho khong nen
duoc sir dung nhu la mot kenh duy nhdt trong viec quyet dinh d~u tu.
5. o mroc Anh, c6 phieu cua cong ty trach nhiem hiru han dai cluing la hoan toan duoc
giao dich tv do voi rmrc v6n c6 phan t6i thieu la 50,000 bang Anh.
6. Nhan vien k~ toan nay dil canh bao toi r&ng cong ty rna ho lam viec khong th~ t6n
tai lau han nira,
7. Toi 10 lang v~ trach nhiem phap ly va trach nhiem no tai chinh cua minh khi cong ty
bi m~t kha nang chi tra.
8. Cac vi giam d6c nay c~n hanh dong than trong d~ tranh bi m~t kha nang thanh khoan
boi vi tien phat do m~t kha nang thanh khoan r~t nang,
9. Hinh tlnrc phat do m~t kha nang thanh khoan c6 th~ bao g6m viec nroc b&ng c~p cua
giam d6c cong ty hoac tham chi bi phat tu.
10. Trang tnrong hop bi m~t kha nang thanh toan, tien lili phai tra cho cac chu no phai
la Uti tien.
Exercise 4
1. Cac vi giam doc cong ty phai nam ra tinh hinh tai chinh hien tai cua cong ty va danh
gia urong lai cua hoat dong nao la kha thi.
2. Cac vi giam d6c phai biet duoc cac giao dich g~n nhdt va cac tai khoan quan tri dira
tren s6 sach k~ toan d~t hang nao.
3. H9 c~n phai lang nghe y kien tu van chuyen mon cua cac ben tu van d9C l~p hoac
cua t6 chirc ngan chan viec m~t tinh thanh khoan dil duoc c~p phep hoat dong.
4. Chung ta c~n dam bao r&ngtai san cua cong ty phai luon duoc bao v~ va khong duoc
ban th~p han gia tri thirc cua tai san do.
131
5. Toi muon ho dam bao r&ngho se khong c~p them han rmrc tin dung neu cong ty nay
khong th~ hoan tra.
6. Anh ta phai luon cho th~y anh ta dang hanh dong t6t nhdt cho t~t ca cac chu no hien
tai cua cong ty.
7. Cac giam doc di~u hanh cao c~p phai t6 chirc h9P dinh ky va hru giir bien ban thao
luan cling nhir cac quyet sach then chot,
8. Ngay khi doanh nghiep cua minh bi m~t kha nang thanh khoan, cac giam d6c c~n
hanh dong nhanh ch6ng tim each bao v~ qua cac thu tuc v~ pha san.
9. M9t t6 chirc chuyen v~ phong ngira pha san c6 th~ giup cac giam d6c cong ty tuan
thu quy trinh thich hop nhat.
10. Khi di~u kien kinh t~ tro nen kh6 khan han thi cac doanh nghiep se bi sut giam manh
doanh s6 giao dich.
Exercise 5
1. Khi mot cong ty khong th~ tra no yay cho chu no thi cong ty se bi x~p vao loai m~t
kha nang thanh khoan.
2. Cong ty d6 da dung giao dich va tai san cua cong ty se duoc ban thao d~ tra cac khoan
no.
3. Sau khi di~u tra, cac tlnrong vu cua ho d~u bi phat hien la c6 gian Ian.
4. Cu6i cung thi cac giam doc d~u c6 lien quan den cac khoan tien b6i nrong va da bi
dira vao tu.
5. M9t s6 diem quan trong thao luan trong cuoc h9P da duoc phat hien khong ghi vao
bien ban.
6. Cong ty da nhap s6 lieu sai vao s6 d~t hang d~ s6 sach th~ hien cong ty lam an c6 hieu
qua han so voi thirc t~.
7. Cac ngan hang ban le nhan tien giri cua khach hang ca nhan va sau d6 cho yay d6i
voi ca nhan va cac cong ty nho.
8. Cac ngan hang tlnrong mai cung c~p dich vu tu van tai chinh, tang v6n thong qua viec
phat hanh c6 phieu hoac trai phieu, xay dung k~ hoach sap nhap va thau t6m.
132
9. Cac ngan hang thuong mai tlnrong c6 cac dich vu quan ly danh muc d~u tu danh cho
d6i tuong khach hang cong ty va khach hang ca nhan Uti tien.
10. Quy phong v~ sir dung cac chien hroc d~u tu mao hiem nham muc dich dat tien
loi cao.
Exercise 6
1. o cac mroc nhu Hoa ky, Anh, Nhat, c6 nhirng quy dinh khong cho phep cac ngan
hang tlnrong mai tham gia vao mang d~u tu.
2. Ngay nay, cac ngan hang Ian tro thanh cac cong ty da nganh khong 16voi hang loat
dich vu tai chinh.
3. Cac ngan hang H6i giao khong tra Eii cho cac nha d~u tu, rna lai d~u tu vao cac cong
ty va chia phan loi nhuan hoac 16Ei cho khach hang gtri tien.
4. M9t s6 nha ban le va cac cira hang bach h6a c6 dira ra mot s6 san pham dich vu nhu
khoan yay ca nhan, the tin dung va bao hiem,
5. Cac d6i tuong yay diroi chuan c6 x~p hang tin nhiem th~p va rui ro khong tra no yay
cao.
6. Trang giai doan khung hoang nha d~t, a Hoa ky nhieu ngan hang dil bi pha san, va
mot s6 ngan hang khac chinh phil phai giai ciru.
7. M9t ngan hang Ian dil duoc chinh phil giai ciru sau khi thua 16hang ty euro do d~u
co.
8. Cong ty chi cho cac hoat dong cua minh b&ng nguon tien do cong ty tao ra.
9. N~u cong ty c~n tang tai chinh d~ mo rong hoat dong, cong ty c6 th~ hoac phat hanh
c6 phieu hoac yay tien.
10. Trai chu se nhan lai tien cho yay vao ngay dao han c6 dinh, va nhan tien lili trai phieu
thea dinh ky,
Exercise 1
133
1. Many international banks in Vietnam .may cause the CUITeD.tcompetition in this

industry more severely.
2. Vietnam has been very active in setting the policy and regulations to attra.ctthe FDL
3. Many investors are interested in buying the shares of our companies thanks to their
prosperous Iiuure:
4. Since the early 21st century, many foreign investments decided to iavestmore money
in the manufacturing industzy.
5. These days, Vietnamese investors would like to have stable regulations and roles
Irom the governmental bodies.
6. It is predicted that in the next year the economy wiDbecome better as the institutions
are having more Dexible policy.
7. Recently, many foreign investment banks have increased their market share by
offering more services to the public.
8. Vietnamese consumers now aim at supporting the domestic producers by buying
more Vietnamese products.
9. Many banks try to attract more customers by diversifying their range of products to
the public.
10. Vietcombank is trying to satisfy their customers by providing new services which
offer.lIee service ch;uges in case the minimum balance is maintained.
Exercise 2
1. One benefit of overseas investment is that we can increase the outbound market share
so quickly.
2. Many foreign companies like to invest in Vietnam because of the young market and
Dexible policies and regulations.
3. One disadvantage of overseas investment is the unstable policies of those countries
which can be diBicuJt to foresee.
134
4. Entrepreneurs can raise capital by pooling money Irom the relative members or the
angels.
5. Most entrepreneurs have difficulty in persuading the angels by proving the success of
their business plan.
6. A start-up company needs to build their.image in the public with their proper business
actions.
7. The success of a start-up company depends on the management decision of the board
led by the CEo
8. When investors invest in a company, they want to.make sure that the money can work
for them eBiciendy.
9. This start-up company did not success because their goals and target were not specific,
measurable, achievable, realistic, and time-bound
10. Last year, many start-up companies were setup as there wss more money iavested
in this kind of business.
Exercise 3
1. We think this start-up company is promising because there are several policy and
regu/;ltions to support the entrepreneurs.
2. That company had a Vel)'promising profitability with a realistic and feasible business
plan.
3. He refused to invest in that start-up because he concluded that it would be vezy risky
to purchase their shares.
4. If the company succeeds, they can .make a great contribution to the economy.
5. Our company could make a large profit this year in comparison with the last two
consecutive years.
6. During recession, many Vietnamese companies had.financialproblem so they needed
to set different policy to survive.
135
7. If you want to borrow money, you have to prove that you can repay the loan as
scheduled.
8. If the borrower cannot repay a loan the bank can take possession of the collateral to
cover the debt
9. If you want to work for an international company, you should improve your
communication skiDs and shsrp your professional knowledge.
10. The difference between central banks and commercial banks are the former are
responsible for the policies while the latter serve the public clients.
Exercise 4
1. If you want to work as a broker, you can earn handsome fees when the securities
market become more positive.
2. The share price of this company went down because of the previous yesr's
uasuccessiul operating results which caused the cash Dow problems.
3. This building society can be one of the competitions of the commercial banking system.
4. If you have financial problems, we can help you to solve this by offering you with the
consumer credit
5. Many economists believe that the economic situation has been improved afier a year
of recession.
6. Our investors are confident that our profitability is becoming more realistic when we
apply the new plan.
7. Currently, our bank focuses on institutional clients as more new companies have been
setup.
8. The credit rating of our company is good so it provides positive opportunities for us
to issue more shares.
9. The Central bank plays a vitalrole in the stability of the national finandaJ system.
10. Their company went bankrupt last year when they made a wrong business decision
to invest in real estates.
136
Exercise 5
1. Because of the recession, my company has been in a diBicult problem since the
beginning of the year.
2. If your company is having financial problems, they can look for angels who can
provide them with the investments.
3. As a CEO, you should .make sure that the strategic plan is realistic and measurable.
4. I am responsible for preparing the Iinsncisl reports and presents them to the
management board periodically.
5. When economic conditions become difficult, the government wiDhave solutions to
kick start to revive the economy.
6. That company stopped trading, and invested in the Iinsncisl industry as a mutual lund
pooling investors' money.
7. Although the director tried his best to protect the company, he 5naUyhad to admit the
serious insolvency.
8. This company did not succeed because they did not have a proper strategic plan with
vaguegoals.
9. This bank refused to lend him the money because he is considered a bad risk which
can default on the repayment
10. Our company needs to iavestmore money in the branches to attra.ctthe customers.
Exercise 6
1. If this company needs money, it can raise capital with equity finance (issuing more
shares) or debt Iinsnce (issuingbonds).
2. If you want to pay for regular bills, you can use direct debits which are vezy good for
current account holder.
3. Online banking is becoming popular because of the development of high technology
and widespread of internet connection.
137
4. Last year, this commercial bank was bailed out by the government because of their
liquidity problem.
S. The employees in this bank are happy to hear that this yesr's profit afier tax has been
doubled.
6. Because today is his first day as a banker, he left the house early in the morning to be
on time at WOlX.
7. Banks are making some changes to adapt to the changing roles and business
environment
8. Companies are prepared to relocate to a new place in the heart of the new city.
9. Peter would like to borrow some money to buy a house as he has changed hisjob and
moved to this city recendy.
10. I think bonds are good because they ca.ny fixed interest rates and guaranteed by
the issuing institutions.
Exercise 7
1. That company intends to issue more shares as they need more capital to develop their
operation outbound
2. Our bank has become more popular recently because the PR department has been
working so eBiciendy in attra.ctingnew customers.
3. If you have money to invest, you should investin stocks and shares due to the prospect
of the securities exchange.
4. If you have money to invest in bonds, you should buy the gilt-edged stocks which have
promising value increase.
S. The stock price of our company is rising, so the market capitalization can exceed the
real value of our company.
6. The stock market in Vietnam has been recovering recendy when there are more
investors looking at this investing channel.
138
7. After I had invested all his money into the stock market, we lost approximately a
.million doDarsso we went bankrupt afierwa.rds.
8. I decided to open my account in this bank because ithasgoodreputationin taking care
of customers.
9. I do not like that bank very much because its nearest branch are about 10 kilometers
away Irom my house.
10. I like to use credit cards because it is vezy convenient especially when I have
international business trips.
Exercise 8
1. When we do online shopping, we can use either our credit card or debit card
conveniendyand quickly.
2. All banking services nowadays aim. at helping customers to enjoy the benefits of non-
cash instruments of payment
3. He was happy to hear that the stock price of his company was recovering aJiera steep
downturn last week.
4. If you invest in the stock market, remember to check the annual corporate financial
reports publicized by the potential company carefUlly.
5. The banks can help us to apply for a mortgage with the terms up to tens of years.
6. That ATM is vel)' convenient because you can get cash without dealing the teDers.
7. In order to open an account in our bank, you need to present necessary documents like
your ID,job agreement, and proof of yearly income.
8. I work in the bank and I help customers to open an account, or to change currencies,
or to transfer money.
9. As a bank teller, you should have good communication skiDs because you deal with a
variety of clients.
10. The services at this bank are vezy good as the bank always invest money in the
innovative schemes.
139
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141
The authors acknowledge the sources of copyright materials. While every

effort has been made, it has not always been possible to identify the sources
of all the materials used, or to trace all copyright holders. If any omissions are
brought to our notice, we will be happy to include the acknowledgements in
the list of reference of this book.
The authors have used the best endeavors to ensure that the URLs for external
websites referred to in this book are correct and active at the time of reference.
However, the authors have no responsibility for the websites and can make no
guarantee that a site will remain live or that the content is or will remain
appropriate.
142
For more reference, the following terminology definitions are taken from the
Cambridge Dictionary.
Account - an arrangement in which a bank looks after your money. You
can deposit or withdraw money when you need to
- a detailed record that a business keeps of the money it receives
and spends in a particular period of time
Accrue if money accrues or is accrued, it gradually increases in amount
Analyst someone whose job is to study or examine something in detail
Annual percentage the interest rate on a loan calculated over a period of twelve
rate months
Applicant someone who has applied to get something such as a loan or

shares
Approve to accept, allow, or officially agree to something
Asset management the management of a companyD s or organizationD s money or

property, in order to make as much profit as possible
Audit to make an official examination of the accounts of a business

and produce a report
Auditor someone whose job is to examine the accounts of a business and

to produce a report on them
143
Bailout a loan or other financial support that is given to a person,

company, or country to help them when they are in financial
difficulties
Balance sheet a financial statement that shows a companyDs assets and debts at
a particular time
Bank statement a record of the money put into and taken out of a bank account
Bankrupt unable to pay what you owe, and having control of your
financial matters given, by a court oflaw, to a person who sells
your property to pay your debts
Bankruptcy a situation in which a business or a person becomes unable to

pay their debts, and is officially bankrupt
Bear market a situation in the stock market in which the prices of shares are
falling
Blue chip a large and successful company whose shares are considered to
be a good investment
Bond an official paper given by the government or a company to

show that you have lent them money that they will pay back to
you at a particular interest rate
Bondholder a person or organization that owns a bond
Bookkeeping the job of recording an organization's financial accounts
Bull market a situation in the stock market in which the prices of shares are
nsmg
144
Capital - money or property that you use to start a business or invest to

earn more money
- valuable resources that are not money
Capital markets the system of financial organizations from which companies

and governments raise money selling stocks, bonds
Cash drawer a compartment underneath a cash register in which the cash

from transactions is kept
Cash flow the movement of money into and out of a companyD s accounts,
used as a measure of how much money the company spend and
receive and how much profit it makes over a particular period of
time
Cashier someone whose job is to take payments from customers or give

out money in a store, bank
Check-out stand the place in a shop, especially a large food shop, where you pay
for your goods
Civil Service a country's government departments and the people who work
in them
Coin a small round piece of metal, usually silver or a red-brown

colour, which is used as money or money in the form of metal
coms
Collateral property that someone borrowing money will give to the loan
company, ifhe or she cannot pay the debt
145
Commission a payment to someone who sells homes, products, investments,

etc., which is directly related to the amount they sell, or the
practice of receiving these payments
Committee a small group of people chosen to represent a larger

organization and make decisions or collect information for it
Common stock a share or shares of a company providing the owner with a right
to vote at shareholder meetings and to receive a part of the
company profits as a dividend
Conduct - to do something, or make something happen; to organize a

particular activity in order to find out or prove facts
- the way in which a process or activity is managed

Conglomerate a very large business organization consisting of several
companies that often sell different types of product or service
Conservatism - the fact of avoiding risks that are unnecessary

~ prudence: the state of being careful in the way you make
decisions or spend money so that you avoid unnecessary risks
Consistency principle a basic principle of accounting stating that the same methods for
doing accounts should be used from one financial year to the
next so that profits, losses, etc. can be compared
Consolidation the process in which amounts or sets of numbers are added

together to form a single amount, statement
Corporate relating to a business, especially a large business

146
Corporate bond a bond that is produced and sold by a company, or the official
document relating to this
Counterparty the buyer or the seller in a financial contract
Coupon the rate of interest that is paid on a bond or a part of a printed

bond that can be separated from it when the bondDs owner wants
to be paid interest by the issuer (= organization from which it
was bought)
Creative accounting the use of methods of recording financial information about a

company, etc. which are legal but which do not show the real
situation clearly, usually making the company seem more
successful than it really is
Credit crunch economic conditions that make financial organizations less

willing to lend money, often causing serious economic
problems
Credit rating agency a company that calculates credit ratings and provides them to
financial organizations and other companies
Credit squeeze economic conditions that make financial organizations less

willing to lend money, often causing serious economic
problems
Creditor a person, organization, or government that is owed money
Creditors = payables: the amounts in a companyDs accounts that show

money owed by the company
147
Currency the system of money that is used in a particular country at a

particular time
Database a computer system containing a large amount of information

that can be looked at or changed easily
Debt the amount of money that is owed by a person, company,

country, etc. and that they usually have to pay interest on; the
situation of owing money, or of not having enough money to
pay what you owe
Debtors = receivables: the money that is owed to a company and that is

shown in its accounts as an asset
Deduct - to take away an amount or part from a total; to take away the
cost of particular things from the amount of money that you
have earned, before you pay tax on it
Default the fact of not paying interest or other money that is owed on
time
Defer to delay something until a later time
Deliver - to achieve, provide, or produce something

- to take goods, letters, parcels, etc. to a place
- to do something that has been promised
Denomination a unit of value stated on a coin, bank note
Depreciation the amount by which a currency loses value in comparison with

other currencies; a loss of value, especially over time
148
Derivative a financial product such as an option (= the right to buy or sell

something in the future) that has a value based on the value of
another asset, such as shares, or bonds
Dividend part of the profit of a company that is paid to shareholders
Document a paper or set of papers that contains official information or

instructions
Downturn a reduction in the amount or success of something, such as a

countryD s economic activity
Due diligence report a detailed examination of a company and its financial records,
done before becoming involved in a business arrangement with
it, such as buying it or selling its shares to investors
Earnings a companyDs or industryDs profits in a particular period
Economist someone whose work is to study the way in which economies

work, or who studies developments within a particular economy
Electronic cash a system designed to enable products to be sold at a retail outlet,

register helping large retail outlets track sales, minimize register errors,
and collect inventory data
Entrepreneur someone who makes money by starting their own business,

especially when this involves seeing a new opportunity and
taking risks
Equity - the capital that a company gets from selling its shares rather
than borrowing money
149
- the value of a property for the owner after it has been sold and
any loan paid back
Evade to intentionally avoid doing or dealing with something that is

your duty or responsibility
Expenditure - the total amount of money that an organization or person

spends
- the act of using or spending energy, time, or money
Exposure - the risk of losing money, for example through a loan or

investment, or the amount of money that might be lost
- the act of investing in something
Federal tax in the US, a tax that you pay to the national government, rather
than to a state government
Flotation (UK) an occasion when a companyD s shares are sold to the

public for the first time
Fraudulent intended to deceive someone, for example, to get money
Going concern the theory assumes that during and beyond the next fiscal period
principle a company will complete its current plans, use its existing assets
and continue to meet its financial obligations
Go public to become a company in which anyone can invest
Government bond an amount of money borrowed by a government, or the official

document relating to this
Hedge fund an investment fund that trades large amounts of shares,

currencies, etc. to take advantage of both rising and falling
150
prices, for example by shorting (= borrowing shares, etc.,

selling them, and buying them back at a lower price)
High-net-worth (high net worth individual) used by financial organizations to

talk about a client or possible client who is very rich
Highly leveraged - used to describe a company that has a large amount of debt
compared to its share capital, (= money in shares) or the
structure of such a companyD s capital
- used to describe a person who has borrowed a large amount of
money compared to their income or the amount of capital they
already have
Historical cost the theory that most assets are to be recorded on the balance
principle sheet at their historical cost even if they have significantly
increased in value over time
Hostile bid a situation in which one company offers to buy another

company whose owners do not want to sell it
Immune not influenced or affected by something / not affected by

something such as a law, because of a special arrangement
Inbound acquisition a transaction in which a foreign company merges with or

acquires a domestic company
Index a system that measures the present value of something when

compared to its previous value or a fixed standard
Inflation an increase in prices over time, causing a reduction in the value

of money
151
Insolvency - the condition of not having enough money to pay debts, buy
goods, etc., or an occasion when this happens
- a situation in which a person or company does not have
enough money to pay debts, buy goods
Insolvent (especially of a company) not having enough money to pay

debts, buy goods
Institution - a large and important organization, such as a bank

- a custom or tradition that has existed for a long time and is
accepted as an important part of a particular society
Insurance cover protection that is given by an insurance company when it agrees

to pay money if a particular thing happens, for example if
someone is injured, or property is lost or damaged
Interest - money that is charged by a bank or other financial

organization for lending money
- money that you earn from keeping your money in an account
in a bank or other financial organization
Intermediary a person or organization that makes business or financial

arrangements between companies or organizations that do not
deal with each other directly
Investment bank a bank that helps companies and organizations to buy and sell
shares, bonds, etc. and helps companies to buy or merge (= join)
with other companies
Invoice a document that lists things provided or work done, gives their
cost, and asks for payment
152
IPO initial public offering: an occasion when shares in a company

are first sold to the public
Issue - the offer for sale by a company or organization of financial

products such as shares or bonds
- all of a particular type of shares, bonds, etc. that are offered for
sale together
Issuer - a legal entity that develops, registers and sells securities to

finance its operations
- a person or company that supplies or distributes something
Journal one of the books in which records of a companyD s financial

activities are recorded, for example, what they buy and sell
Large-scale service business activity that involves a lot of people, things, or activity,
or happening over a large area
Launch - the introduction of a new product or service for sale to the

public
- the beginning of something new, such as a plan, business, or
job
Layoff - the act of ending a workerD s job, sometimes temporarily,

usually because there is not enough work to do
- a period when someone is not working because their job ended
or they were forced to leave it
Ledger a book or a computer document in which a companyD s accounts

are recorded, especially the money it has spent and received
Legislative relating to laws and the process of making laws

153
Liability the amount of money that a person or organization owes
Limited company a company, especially one in the UK, whose owners only have
to pay part of the money they owe if the company fails
financially
Liquidation - a situation in which a company stops operating and sells all its
assets in order to pay its debts
- a situation in which an asset is sold in order to get cash
List a record of short pieces of information, such as people Ds names,

usually written or printed with a single thing on each line and
often ordered in a way that makes a particular thing easy to find
Management buyout the situation in which a companyDs senior managers buy the
company that they work for, or enough shares in it to get control
of it
Margin - the difference between the total cost of making and selling
something and the price it is sold for
- the difference between the amount of a loan and the value of
the collateral (= property to be given to the lender if the money
is not paid back)
- money, shares, etc. that a client gives to a broker to hold, that
protect the broker from loss on a contract
Market capitalization a way of measuring the value of a company calculated by

multiplying the number of the company's shares by their price
on the stock market
154
Market fluctuation frequent changes in the amount, value, or level of the business
or activity of buying and selling a particular product or service
Market maker someone whose job is to buy and sell stocks and shares for
other people on the stock market
Matching principle the theory that an expense must be recorded in the same
accounting period in which it was used to produce revenue
Maturity the time when the interest and profits on money that has been
invested must be paid
Merger the process of combining two companies or organizations to

form a bigger one
Minutes the written record of what was said at a meeting (plural)
Moneylender a person or business that lends money but is not connected with
a bank
Mortgage a legal agreement to borrow money from a bank or other

financial organization, especially to buy a house or other
property, or the amount of money borrowed
Municipal bond a bond that is sold by a town or city government in the US
Mutual - used to describe something that is done or felt by all or both

people in a group
- used for describing a financial organization that is owned by
its members, rather than by shareholders
Nominal value the value of a share, bond, etc. when it is made available for
sale for the first time
155
Object - a thing that you can see and hold

- something you are planning to do or the result you hope to
achieve
Offer to make shares, etc. available for sale
Ongoing cost = operating costs: expenses required for the day-to-day

administration and maintenance of a business entity
Option the right to buy something in the future
Ordinary share a share of a company providing the owner with a right to vote at
shareholder meetings and to receive a part of the company
profits as a dividend
Outbound acquisition a transaction in which a domestic company purchases or merges

with one in another country
Outstanding - of a debt which has not yet been paid

- used to talk about the total number of shares held by a
companyD shareholders at a particular time
- an outstanding problem or subject has not been solved or
discussed
Overdraft an amount of money that a customer with a bank account is

temporarily allowed to owe to the bank, or the agreement which
allows this
Ownership - the state or fact of owning something

- the fact of taking responsibility for an idea or problem
156
Par value the value of a share, bond, etc. when it is made available for
sale for the first time
Partner one of the owners of a company
Partnership - an agreement between organizations, people, etc. to work

together
- a company which is owned by two or more people
Passbook a small book that is used to record how much money is in a

customerD s bank account
Paycheck - a cheque that you are given by your employer as your pay
- the amount of money that a person earns, usually each month
Pension a regular income paid by a government or a financial

organization to someone who no longer works, usually because
of their age or health
Performance how successful an investment, company, etc. is and how much

profit it makes
PIN = personal identification number: a secret number used with a

bank card to get money from a cash machine or pay for goods in
a store
plummet to go down in amount or value very quickly and suddenly
Point of Sale a device for cashier to accept credit cards or debit cards
portfolio - a collection of different investments that are owned by a

particular person or organization
157
- the range of products or services that a company offers, or the

businesses that someone owns
prepaid if a product or service is prepaid, it has already been paid for
Primary Market the place for the sale of shares, bonds, etc. at the time they are
first made available, rather than when they are traded later
Principal - an amount of money lent or borrowed, rather than the interest

paid on it
- relating to an amount of money lent or borrowed, rather than
to the interest paid on it
Private company a company that is owned by one person or a small group of

people, for example a family, and whose shares are not traded
on a stock market
Profit money that is earned in trade or business, especially after

paying the costs of producing and selling goods and services
Property (UK) Real estate (US)
Prospectus - a legal document offering a companyD s shares for sale, and

giving details about the company and its activities
- a small book giving details of a school or college, or of a new
business or project
Provision in a companyDs accounts (= financial records), an amount of

money that is kept in case of a possible future loss
Public company a company whose shares are traded on a stock exchange
Purchase price the amount of money that is paid for something

158
Quote - to give the current price of a companyD s shares or of a currency

- to record a companyD s name on a stock exchange so that its
shares can be traded there
Raise to manage to get money to invest in a business, project, property
Rate of return the amount of profit that an investment earns calculated as a

percentage of the money that was originally invested
Real estate - land or buildings that someone owns

- the activity of buying and selling land and buildings
Receivable still to be received by the person or company to whom money is

owed
Receivership a situation in which a bankrupt company is under the control of

a recerver
Recession a period, usually at least six months, of low economic activity,

when investments lose value, businesses fail, and
unemployment rises
Remedy - a method of legally solving a problem or disagreement

- a way of dealing with a difficult situation or solving a problem
Repay to pay back money that you have borrowed
Reserve to arrange for something to be kept for you, for example, a seat
on an aircraft or a table at a restaurant
Retail the activity of selling goods to the public in stores, on the

internet, etc., rather than selling to stores, other businesses
159
Retain to keep or continue to have something, especially a position or

money, or control of something
Revenue money that a company receives, especially from selling goods

or services
Securitize to borrow money in the form of bonds which can then be traded
on financial markets
Security (UK) = property or goods that you promise to give to someone if you
Collateral (US) cannot pay what you owe them
Settle to pay for something
Shareholder a person or organization that owns shares in a company
Shortage a situation in which there is less of something than people want

or need
Smart card a small plastic card that is used to make payments or to hold
personal information electronically so that it can be read by a
computer system
Speculative - done in order to make a profit even though there is risk that
you may lose money
- a speculative investor is willing to accept a high level of risk
in the hope of making a profit
Speculator a person who buys goods, property, money, etc. in the hope of
selling them at a profit
Standardize to make things of the same type have the same basic features
160
Start-up a business that has just been started
Stock exchange a place where shares are bought and sold, and the people and
organizations involved in this
Stockbroker a person or financial organization that buys and sells shares,

bonds, etc. for other people and organizations
Subprime used to describe the practice of lending money, especially to

buy a house, to people who may not be able to pay it back
Subsidiary a company that is controlled by another
Supervision the activity of managing a department, project, etc. and of

making sure that things are done correctly and according to the
rules
Surplus funds the money remaining after all liabilities, including taxes,
insurance, and operating expenses, are paid; which indicates
that a company has made a profit or perhaps that it has
completed a project under budget
Sustainable able to continue at the same level for a period of time
Takeover the act of taking control of a company by buying enough of its

shares to do this
Tangible asset a physical asset whose value can be easily measured, such as
cash, property, goods, or machinery
Tax revenue money that a government receives from taxes

161
Taxable taxable earnings, goods, assets, etc. require a particular amount

of their value to be paid to the government
Taxation - the system of collecting taxes

- money that is collected as tax
Terms and conditions the rules that apply to fulfilling a particular contract and that
form an integral part of that contract
The Treasury (in the UK, US, and some other countries) the government
department responsible for government spending, borrowing,
tax, and so on
the government department responsible for a country's financial

matters
Transaction - an occasion when someone buys or sells something

- the process of doing business
Trial balance a bookkeeping worksheet in which the balances of all ledgers

are compiled into debit and credit account column totals that are
equal
Underwrite - to invest money to help someone to start a new project

- to protect someone from loss with an insurance policy
- to protect a company from loss by agreeing to buy any
remaining shares that are not bought by the public when the
shares first become available for sale
Underwrite to give an activity financial support and take responsibility for

paying any costs if it fails
162
Vulnerable easily damaged by something negative or harmful
Warranty a minor term in a contract (The breach of a warranty does not

end a contract, in contrast to a condition)
Whistle-blower someone who reports dishonest or illegal activities within an

organization to someone in authority
Wholesale relating to the business of selling large quantities of goods,

especially to people who are going to sell them in a shop
Withdraw to take money from a bank account withdraw

cash/money/ savings
Withdrawal the process of taking an amount of money out of your bank

account, or the amount of money taken out
Yield a profit on money that have been invested

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TRUONG f)~I HOC NGAN HANG TP.

Tai li~u tham khao:

TIE~f7 ~ti T,4i etii~ti

Chu bien: Nguyen Ngoc Phuong Dung

V[2ACTIC~ 1j()()I\: ~~f7LI§1l

Nguyen Ngoc Phuong Dung

SECTION 2: FURTHER PRACTICE

SECTION 3: ANSWERS- REFERENCES- ACKNOWLEDGEMENTS- GLOSSARY

C. a large company formed by joining different smaller firms together.

1.2 Match these tenns wtth their corresponding meanings.

A. a piece of business that is done between people, especially an act of buying or

E. an economic condition in which it suddenly becomes difficult and expensive to

PART 2: CLOZE PASSAGES

capital certificates institutions back suppliers debt

bond interest lender securitised dividend credit

PART 3: READING COMPREHENSION

1. What services are offered by an investment bank to the institutions?

4. What does the stockbroking and dealing department do?

2. What did the Barclays Bank lead the way in?

4.1 Translate the following sentences Into VletnaJllese.

3. Large banks became international conglomerates offering a complete range of

5. A financial institution is an establishment that conducts financial transactions such

4.2 VletnaJlle8e- EnlPlsh translation: Translate the following sentences Into

PART 1: VOCABUlARY PRAcneE

1.2 Match these tenns with their corresponding meanings.

4 Market maker 5 Insolvent

PART 2: CLOZE PASSAGES

taxable bond debt issued ownership treasury

Corporate bonds (also called corporates) are (1) debt

bonds for a variety of purposes, from building facilities to purchasing equipment to

bankruptcy cash flow profits distribution bondholders contribution

PART 3: READING COMPREHENSION

WHAT ARE THE DIFFERENT TYPES OF BONDS?

2. What institutions issue treasuries?

3. What does GSE represent?

4. Why are GSEs issued?

UNDERSTANDING HEDGE FUNDS

1. Who decides the number of investors of a hedge fund?

4. What does the principle of 'absolute return' entail?

4.2 VletnaJlle8e - EnlPlsh translafton: Translate the following sentences Into

thi tnrong c6 tinh thanh khoan cao.

4. If a company goes bankrupt, bondholders can

1.2 Match these tenns with their corresponding meanings.

4 Nominal value 5 Bull market

A. a market in which share prices are increasing, encouraging more investors.

PART 2: CLOZE PASSAGES

corporation public limited private creditor liquidation underwrite

certificates stocks shares investment flotation primary

report financing financing stock shares

bonds prospectus corporation liabilities secondary exchange

The company will commission a (1) : a detailed examination of its financial

PART 3. READING COMPREHENSION

Stefan Armbruster, BBe News online

people Ds financial health. Any pain suffered by thesenstitutional investors impacts on

1. Who suffers the consequences when share prices go down?

3. How can companies raise funds to expand?

4. What do companies do to increase the company's value?

Individuals and groups of people doing business as a partnership have unlimited

2. What are the risk of the creditors?