5. Read the text and translate it into Russian.

Liquidity

Liquidity is determined by the speed and certainty with which an asset can be converted into cash (notes and coins) in order to be used as a means of payment. The quicker an asset can be converted into cash, the more liquid it is. Therefore, money is sure to be the most liquid asset of all since it is widely accepted as a medium of exchange, while durable and highly specific assets such as machinery are the least liquid as such asset can not be converted into money without finding a buyer and determining the value of the asset to be sold.

Bank’s assets can also be characterized in terms of liquidity.

Loans to households and firms do not appear to be very liquid forms of bank lending, for the borrower may not be able to repay the sum owed to the bank whenever the bank demands.

Of all bank assets cash and short-term loans are sure to be the most liquid ones.

6. Finish the following sentences.

1) The easier an asset is converted into cash, …

2) Assets such as machinery are the least liquid as …

3) Loans to households and firms turn out not to be highly liquid for …

4) The most liquid bank assets are …

7. Read the text and translate it into Russian.

Types of Banks

Central banks supervise the banking system, fix the minimum interest rate, issue bank notes, control the money supply and act as lenders of last resort.

Commercial banks are businesses that trade in money. They receive and hold deposits, pay money according to customers’ instructions, lend money and so on. In some countries such as England these banks have branches in all major towns.

In some European countries, notably Germany, Austria and Switzerland, there are universal banks, which combine deposit and loan banking with share and bond dealing, investment advice, etc. Yet even universal banks usually form a subsidiary, known as a finance house, to lend money – at several per cent over the base landing rate – for higher purchase or instalment credit, that is, loans to customers that are repaid in regular, equal monthly amounts.

In Britain, the USA and Japan, however, there is, or used to be, a strict separation between commercial banks and banks that do stock broking or bond dealing. Thus in Britain, merchant banks specialize in raising funds for industry on the various financial markets, financing international trade, issuing securities, dealing with merges and so on. They also offer stock broking and portfolio management services to rich corporate and individual clients. But the distinction between commercial and merchant banks has become less clear in recent years.

In Britain there are also building societies that provide mortgages, i.e. they lend money to home buyers on the security of houses and flats, and attract savers by paying higher interest,

than the banks.

There are also supranational banks such as the World Bank or the European Bank for Reconstruction and Development, which are generally concerned with economic development.

8. Summarize the information of the unit and speak on the topic: Commercial Banks