BFB1001 Lecture Notes - Lecture 7: Bpay, Investment Banking, Retained Earnings
2 Aug 2018
School
Department
Course
Professor
Document Summary
Financial institutions: provide intermediation and the system of payments in the domestic and global economy; allowing safe and ef cient . Storage and management of money for individuals and institutions allowing consumption and trade. Payments of large sums of money without need for physical cash. Currency exchange & international payments across borders. Banks: manage the most amount of money in australia, making them the most important adi and. Accept deposits from savers who store their money with the bank in return for a return (interest). Then, combined with other sources of funds, this capital is lent out by the bank to borrowers at a higher return than paid for the capital. Four pillars policy: policy of the australian government which does not allow mergers or acquisitions among the four major commercial banks. This ensues suf cient competition within the banking industry for the bene t of the general public, and prevents an undue concentration of banking risk.
