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

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)
__ . Companies can borrow this money, called a (2) from banks. The loan
must be paid (3) __ with interest: the amount paid to borrow the (4) . Capital
can also come from issuing shares or equities - (5) representing units of
ownership ofa company. The people who invest money in shares is known as (6) __
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Individuals and financial (7) called investors can also lend money to companies
by buying bonds - loans that pay (8) and are paid at a fixed future date.

2.2 Passage 2. Complete the passage wtth the words In the box.
bank borrower investor repayments corporate customer

bond interest lender securitised dividend credit

A financial institution, such as a (1) , buys a loan from a (2) (such

as another bank), who has already lent an amount of money to a (3) (another
person or institution). This means that the financial institution now has the right to
collect the (4) on the original borrowerD s loan. It then uses the expectation of
receiving these as security for a (5) which it issues to an individual or corporate
(6) 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") payments to the bond holder until the
date when the bond is repaid. Both the financial institution who bought the loan and (8)
__ 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.
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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?

2. What is IPO?

3. Besides raising capital from the public, how can they raise funds?

4. What does the stockbroking and dealing department do?

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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?

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

3. What did one of the earliest cash dispensers consist of?

4. When could the customer gain access to the system?

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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.

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.

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

financial services that were previously provided by banks, hedge funds and insurance
companies.

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.

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

as investments, loans and deposits.

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,
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2. M9t s6 ngan hang ban le la cac t~p dean quoc t~ voi nhieu ngan hang chi nhanh tren
toan th~ gioi.

3. Nho cong nghe, cluing ta co th~ mua sam t11Jctuyen, giao tiep t11Jctuyen, va tham
chi co th~ thirc hien ngan hang t11Jctuyen,

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.

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.

PART 5: WRITING
Make meaningful sentences by adding between 8 and 15 words to the given
phrases.
1. Subprime borrowers are .
2. Securitization means .
3. When many subprime borrowers stopped paying, .
4. The credit crunch happens when there is a .
5. Non- bank financial intermediaries .