Unit 8 Banking Lead-in Reading: The Business of Banking Session 1

Unit 8 BankingUnit 8 Banking

Lead-in

Reading: The Business of Banking

Session 1

Lead-in

Task 1

Task 2

Task 3

Section I

Can you name those logos?

Task 1

Key

(1) China Merchants Bank （招商银行） : China Merchants Bank is a bank headquartered in Shenzhen, China. Founded in 1987, it is the first share-holding commercial bank wholly owned by corporate legal entities. CMB has over five hundred branches in mainland China and one in Hong Kong. In November 2007, as part of a drive for international growth, it won federal approval

to open a branch in New York.(2) China Post （中国邮政） : China post is the official postal

service of the People's Republic of China. China Post is operated by the State Post Bureau of the People's Republic of China. The State Post Bureau, commonly referred to as China Post is both a regulatory authority and government owned enterprise.

(1) China Merchants Bank （招商银行） : China Merchants Bank is a bank headquartered in Shenzhen, China. Founded in 1987, it is the first share-holding commercial bank wholly owned by corporate legal entities. CMB has over five hundred branches in mainland China and one in Hong Kong. In November 2007, as part of a drive for international growth, it won federal approval

to open a branch in New York.(2) China Post （中国邮政） : China post is the official postal

service of the People's Republic of China. China Post is operated by the State Post Bureau of the People's Republic of China. The State Post Bureau, commonly referred to as China Post is both a regulatory authority and government owned enterprise.

Key for Task 1Key for Task 1

(3) Citibank （花旗银行） : Citibank is a major international

bank, founded in 1812 as the City Bank of New York, later First National City Bank of New York. Citibank is now the consumer banking arm of financial services giant Citigroup, one of the largest companies in the world. As of March 2007, it is the largest bank in the United States by holdings.

(3) Citibank （花旗银行） : Citibank is a major international

bank, founded in 1812 as the City Bank of New York, later First National City Bank of New York. Citibank is now the consumer banking arm of financial services giant Citigroup, one of the largest companies in the world. As of March 2007, it is the largest bank in the United States by holdings.


(4) Bank of China （中国银行） : Bank of China is one of the “big four” state-owned commercial banks of the People's Republic of China. It was founded in 1912 by the Government of the Republic of China, to replace the Government Bank of Imperial China. It is the oldest bank in China. From its establishment until 1942, it issued banknotes on behalf of the Government of the Republic of China along with the “Big Four”banks of the period: the Central Bank of China, Farmers Bank of China and Bank of Communications. Although it initially functioned as the Chinese central bank, in 1948 the People’s Bank of China replaced it in that role. Subsequently, BOC became a pure commercial bank.

(4) Bank of China （中国银行） : Bank of China is one of the “big four” state-owned commercial banks of the People's Republic of China. It was founded in 1912 by the Government of the Republic of China, to replace the Government Bank of Imperial China. It is the oldest bank in China. From its establishment until 1942, it issued banknotes on behalf of the Government of the Republic of China along with the “Big Four”banks of the period: the Central Bank of China, Farmers Bank of China and Bank of Communications. Although it initially functioned as the Chinese central bank, in 1948 the People’s Bank of China replaced it in that role. Subsequently, BOC became a pure commercial bank.


(5) China Construction Bank （中国建设银行） : China Construction Bank is one of the “big four” banks in the People's Republic of China. The bank maintains overseas branches in Hong Kong, Singapore, Frankfurt, Johannesburg, Tokyo and Seoul, as well as a representative office in Sydney.

(5) China Construction Bank （中国建设银行） : China Construction Bank is one of the “big four” banks in the People's Republic of China. The bank maintains overseas branches in Hong Kong, Singapore, Frankfurt, Johannesburg, Tokyo and Seoul, as well as a representative office in Sydney.


(6) United Bank of Switzerland ( 瑞士联合银行 ): United Bank of Switzerland is a diversified global financial services company, with its main headquarters in Basel and Zurich, Switzerland. It is the world's largest manager of private wealth assets, "the world's biggest manager of other people's money" and is also the second-largest bank in Europe, by both market capitalization and profitability. UBS has a major presence in the United States, with its American headquarters located in New York City Investment banking); Weehawken, New Jersey (Private Wealth Management); and Stamford, Connecticut( Capital market). UBS’s retail offices are located throughout the U.S., and in over 50 other countries. UBS is an abbreviation, with originated from a predecessor firm, for the Union Bank of Switzerland; however, UBS ceased to be considered a representational abbreviation after its 1998 merger with Swiss Bank Corporation.

(6) United Bank of Switzerland ( 瑞士联合银行 ): United Bank of Switzerland is a diversified global financial services company, with its main headquarters in Basel and Zurich, Switzerland. It is the world's largest manager of private wealth assets, "the world's biggest manager of other people's money" and is also the second-largest bank in Europe, by both market capitalization and profitability. UBS has a major presence in the United States, with its American headquarters located in New York City Investment banking); Weehawken, New Jersey (Private Wealth Management); and Stamford, Connecticut( Capital market). UBS’s retail offices are located throughout the U.S., and in over 50 other countries. UBS is an abbreviation, with originated from a predecessor firm, for the Union Bank of Switzerland; however, UBS ceased to be considered a representational abbreviation after its 1998 merger with Swiss Bank Corporation.


What kind of service does a bank offer in those pictures?

Task 2

Key

(1) deposit and withdrawal

(2) loans

(3) e-banking

(4) credit (ATM) cards

(1) deposit and withdrawal

(2) loans

(3) e-banking

(4) credit (ATM) cards


What transaction can you do with e-banking?Task 3

Telephone-banking

ATM

Online-banking

Key

Through e-banking, you can transfer funds, pay bills, view checking and saving account balances, pay mortgages, handling check deposits or issuing cash withdrawals etc.

Through e-banking, you can transfer funds, pay bills, view checking and saving account balances, pay mortgages, handling check deposits or issuing cash withdrawals etc.


Reading

Introductory Remarks

Warm-up Discussion

Intensive Reading

Section Ⅱ

Practice

The business of banking can be broadly defined as wise management and circulation of all kinds of money in the best interests of every unit of money. Today, a bank is a financial intermediary that offers a wide range of services to meet their customers’ financial needs. Two fundamental banking services are accepting deposits and making loans. Other services include payment services; deposit and lending services; investment, pensions and insurance services and e-banking.

Introductory Remarks

1 Before you read, work in pairs and discuss the following questions.

(1) What do you know about banking services?(2) What role do you think banking plays in our lives?

Warm-up Discussion

A bank is a financial intermediary* that acts as the go-between for individuals and businesses that have extra money and those that wish to borrow money by offering loans and deposits, and payment services(1). The term “financial intermediation” means accepting funds from one source (such as savings customers) and using the money to make loans or other investment. By doing so, banks help make money with each set of transactions* (2).

Today, our personal and business affairs could not be transacted without the money medium – the banking system. The business of banking can be broadly defined as wise management and circulation* of all kinds of money(3) . Customers turn to banks to borrow money to achieve goals, to prevent losses, to facilitate returns on idle funds, and to manage funds conveniently and effectively (4) . Banks also offer a wide range of additional services.

The Business of Banking

Although banking covers a large number of different operations, the main functions are not difficult to understand. Two fundamental functions, known to every layman, are accepting deposits* and making loans (5) .

While banks play an important role in financial intermediation, banking’s primary focus is the satisfaction of customers’ financial needs. Modern banks offer a wide range of financial services, including:

• Payment services• Deposit and lending services• Investment, pensions and insurance services• E-banking

Banks play a major role in the provision of payment services. For personal customers the main types of payments are made by writing cheques from their current accounts (known as “checking accounts” in the United States) or via debit or credit card payments(6). In most countries the retail payments systems are owned and run by the main banks.

In addition to payment service personal banking includes the offer of a broad range of deposit and lending services(7). There are two types of deposits, namely, the Checking Account and the Fixed Deposit Account (8) . Current or checking accounts typically pay no (or low) rates of interest and are used mainly for payments. The Fixed Deposit Account, receiving interest, must remain with the bank for a stipulated time, as specified on the deposit receipt issued (9) . Loans and other credit services are important services offered by banks to their customers. There are two major categories of loans: business and consumer (10) . Loans can be secured or unsecured. A secured loan is one in which an asset, such as inventory* or property, is pledged against repayment of the loan (11).

Banking also includes a great variety of additional products and services that meet customers’ financial needs. A few of these products and services include investment products, pensions and insurance services, and foreign exchange services.

Banking has been changing rapidly worldwide. A number of innovative financial products have been developed in recent years. Today the banking system processes more and more electronic transactions to make payments and transfer funds. Although many customers still visit bank offices, the use of electronic banking services continues to grow each year. Electronic banking services include remote terminal transactions (ATMs), telephone transactions, and on-line PC banking.

Today, banking services have become available 24 hours a day, 365 days a year, through ATMs, at online banking, and in electronically enabled exchanges where everything from stocks to currency futures contracts can be traded (12) . With the growth of e-business, traditional corporate relationships outside the banking industry are changing rapidly. New business-to-business (B2B) relationships are forcing global banks to consider ways of changing their wholesale banking* operations so as to embrace many of these developments (13).

Word studyWord studyWord studyWord study

Text analysis1) A bank is a financial intermediary that acts as the go-

between for individuals and businesses that have extra money and those that wish to borrow money by offering loans and deposits, and payment services.

银行是一个金融中介，通过提供贷款、储蓄和支付服务，在

有富余金钱和想申请借贷的个人和企业间充当媒介。

intermediary: (n.) person who acts as a means of communication between two or more others e.g.: They disliked each other too much to meet, so they conducted all their business through an intermediary.

TranslationTranslationTranslationTranslation


Text analysis

2) By doing so, banks help create money with each set of transactions.

这样一来，银行在每一笔交易中都创造了金钱。（这里不是指印刷纸币，而是指通过借贷，扩大了金钱的供应。）


transaction: (n.) an action or set of actions occurring between two or more parties relating to the conduct of business, commercial activities. e.g.: Buying a house is an important transaction for most people.


Text analysis

3) The business of banking can be broadly defined as wise management and circulation of all kinds of money.

银行业可以广义的定义为对各种资产的妥善管理和流通。 define (sth) as (sth): state precisely the meaning of (e.g. words); state (sth) clearly; explain (sth) e.g.: Physics can be defined simply as the study of matter and motion.



Text analysis4) Customers turn to banks to borrow money to achieve goals, to prevent losses to facilitate returns on idle funds, and to manage funds conveniently and effectively.

顾客去银行贷款以实现目标，防止损失，集聚闲散资金的回报，以及方便有效地管理资金。

facilitate: (v.) to make easier: help bring about e.g.: Modern devices facilitate domestic work.


Text analysis

5) Two fundamental functions, known to every layman, are accepting deposits and making loans.

任何一个非专业人士都知道，银行的两大基本的功能是存储和贷款。

fundamental: (adj.) serving as a basis supporting existence or determining essential structure or function; of central importancee.g.: Fresh air is fundamental to good


AnalysisAnalysisAnalysisAnalysis


Text analysis6) For personal customers the main types of payments are made by writing cheques from their current accounts (known as “checking accounts” in the United States) or via debit or credit card payments.

对个人用户而言，主要的支付方式有：从他们的活期帐户（在美国也称“经常帐户”）里开支票；或通过借记卡或是信用卡来进行支付。

know sb/sth as sth: call, nickname or label sb / sth as sth. e.g.: This area is known as the “Cornish Riviera”

cheque (US check): (n.) special printed form on which one writes an order to a bank to pay a sum of money from one’s account to another person e.g.: Can I pay it by cheque?



Text analysis

7 ） In addition to payment service personal banking includes the offer of a broad range of deposit and lending services.

除了支付服务，个人银行业务同样提供多种存款和借贷服务。

in addition (to sb/sth): as an extra person, thing or circumstance e.g.: In addition there are four other applicants.



Text analysis

8) There are two types of deposits, namely, the Checking Account and the Fixed Deposit Account.

有两种类型的存款，即，活期帐户和定期帐户。

9) The Fixed Deposit Account, receiving interest, must remain with the bank for a stipulated time, as specified on the deposit receipt issued.

定期存款帐户获取一定的利息，必须在存款单上约定的期限后才能支取。

stipulate: (v.) state (sth) clearly and firmly as a requirement e.g.: It was stipulated that the goods should be delivered within ten days.


Text analysis



Text analysis

10) There are two major categories of loans: business and consumer.

主要有两大类别的贷款：企业贷款和个人贷款。

category: (n.) class or group of things in a complete system of groupinge.g.: place things in categories


Text analysis11) A secured loan is one in which an asset, such as inventory* or property, is pledged against repayment of the loan.

抵押贷款是指以一定的资产如货物或个人财产作为抵押 , 向银行保证偿还贷款。

pledge: (v.) leave sth with sb to be kept until the giver has done sth promised, e.g. paid a debt e.g.: Six sponsors had pledged more than $ 300 000 to back the Human Resources Corporation.


AnalysisAnalysisAnalysisAnalysis


Text analysis 12) Today, banking services have become available 24 hours a day, 365 days a year, through ATMs, at online banking, and in electronically enabled exchanges where everything from stocks to currency futures contracts can be traded.

今天，已经实现了一天 24 小时，一年 365 天不间断的银行服务，通过自动提款机，在线银行和电子交易所，从股票到货币期货合同的一切交易都可以进行。

available: (adj.) (of things) that can be used or obtained e.g.: You will be informed when the shoes become available.


13) New business-to-business (B2B) relationships are forcing global banks to consider ways of changing their wholesale banking operations so as to embrace many of these developments.

新型的企业对企业的电子商务关系正迫使全球银行考虑改变其批发银行业务的运作，以迎接许多新的发展。

embrace: (v.) take (a person, etc) into one’s arms as a sign of affectione.g.: They embraced each other warmly.


Text analysis


2 Read the text and finish the following comprehensive tasks.

(1) How can the term “business of banking” be broadly defined?

(2) What are two fundamental functions of banks?

(3) List some services banks offer to their customers.

(4) Explain the differences between current account and fixed deposit account.

(5) What do electronic banking services include?

Practice

Keys Keys

(1) The “business of banking” can be broadly defined as wise management and circulation of all kinds of money in the best interests of every unit of money.

(2) Accepting deposits and making loans.(3) Payment services; deposit and lending services;

investment, pensions and insurance services; and E-banking.

(4) Current accounts pay no or low rates of interest while the fixed deposit accounts receive interest. The fixed deposit account must remain with the bank for a stipulated time.

(5) Remote terminal transactions; telephone transactions; and online PC banking.

Keys for Comprehensive TasksKeys for Comprehensive Tasks

(1) Banks can only provide loans and deposits, and payment service.

(2)When we talk of “financial intermediation”, we mean banks aim to satisfy customers’ financial needs.

(3) Banks provide three types of payment for personal customers.

(4) More and more people prefer to use the electronic banking services in recent years.

(5) It is impossible for people to make transactions if they don’t visit bank offices.

3 Read the text again and decide if the following statements are true (T) or false (F).

F

F

F

F

T

Documents

Unit 8 Banking Lead-in Reading: The Business of Banking Session 1