Chapter OneAn Overview of the Changing Financial-Services SectorCopyright 2010 by The McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin

Key TopicsPowerful Forces Reshaping the Industry What Is a Bank? The Financial System and Competing Financial-Service Institutions Old and New Services Offered to the Public Key Trends Affecting All Financial-Service Firms

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The Different Kinds of Financial Service Firms Calling Themselves BanksCommercial BanksSavings BanksCooperative BanksMortgage BanksCommunity BanksMoney Center BanksInvestment BanksMerchant BanksInternational BanksWholesale BanksRetail BanksLimited Purpose BanksBankers BanksMinority BanksNational BanksState BanksInsured BanksMember BanksAffiliated BanksVirtual BanksFringe BanksUniversal Banks

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The Financial Service Competitors of BanksSavings AssociationsCredit UnionsMoney Market FundsMutual Funds (Investment Companies)Hedge FundsSecurity Brokers and DealersInvestment BanksFinance CompaniesFinancial Holding CompaniesLife and Property-Casualty Insurance Companies1-*

Quick QuizWhat is a bank? How does a bank differ from most other financial-service providers?

Under current U.S. federal law what must a corporation do to qualify and be regulated as a commercial bank?

What is happening to bankings share of the financial marketplace and why?

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Traditional Services Offered By BanksCarrying Out Currency ExchangeDiscounting Commercial Notes and Making Business LoansOffering Savings DepositsSafekeeping of ValuablesSupporting Government Activities with CreditOffering Checking AccountsOffering Trust Services1-*

More Recent Services Offered by BanksGranting Consumer LoansProviding Financial AdviceManaging CashOffering Equipment LeasingMaking Venture Capital LoansSelling Insurance PoliciesSelling Retirement Plans1-*

Offering Security Brokerage and Investment Banking ServicesUnderwriting SecuritiesOffering Mutual Funds and AnnuitiesOffering Merchant Banking ServicesOffering Risk Management and Hedging Services

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Trends Affecting Banks and Other Financial Service Firms TodayService ProliferationRising CompetitionGovernment DeregulationIncreased Interest Rate SensitivityTechnological Change and AutomationConsolidation and Geographic ExpansionE-Banking and E-CommerceConvergenceGlobalization1-*

Quick QuizWhy do banks and other financial intermediaries exist in modern society, according to the theory of finance?

How have banking and the financial services market changed in recent years?

What powerful forces are shaping financial markets and institutions today? Which of these forces do you think will continue into the future? 1-*

Web LinksFederal Deposit Insurance Company www.fdic.gov Federal Financial Institutions Examination Council www.ffiec.govOffice of Thrift Supervision www.ots.treas.gov Credit Union National Association www.cuna.org Morningstar, Inc. http://www.morningstar.com Security and Exchange Commission www.sec.gov Careers in Finance www.careers-in-finance.com Bank Job Search www.bankjobsearch.com Bank Jobs www.bankjobs.com 1-*

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