Situation 1

The business owner. You own a profitable casino situated in the center of your city. Every week you have $100 thousand in cash which makes the extra profit of your business. You wish to deposit this money with a bank. You are going to contact the Head of Account and Operation division to discuss the details.

Head of Account and Operation Division. You know that such a client is very advantageous for your bank. But you can’t open any accounts during a half of the year because they are overdrawn by your bank. You can offer the businessmen deposit certificates or bank’s bonds (bills). It’s necessary to convince your client that such types of investment are more profitable.

Situation 2

You are the owner of a car-service center. You keep your temporarily unused money on bank deposits and buy certificates of deposits. You have a good friend. He runs a large chain store and keeps his money in bank bonds and bills. You meet each other and exchange your opinions about advantages and disadvantages of those means of saving money used by you both.

Brainstorming activity Problem 1

You are the owner of a bank. You were informed that the chief manager of one of your branches had been noticed in amoral behavior (drugs, drinks, and love affairs). This fact casts a shadow on the image of your bank through mass media and rumors. At the same time this branch became one of the most profitable ones under the leadership of this chief manager. The town, where this branch is located, is small, provincial and puritanical. What would you do?

Problem 2

You are the Head of Account and Operation Division. The person who’s been your client for 15 years comes to see you. He holds a large deposit with the bank and a small amount of bank’s shares. He wants to withdraw his deposit and interest before its maturity date. It contradicts the regulations but your client asks you to make an exception for him. His main argument is that he’d been a reliable client of the bank during the last economic crises. Moreover, he is a well-known person in the city. What would you do?

Final discussion

Preparing for final discussion, try to search for extra information in special editions, magazines and financial text-books. Consult your teachers of special subjects and use the Internet resources. It is recommended to subdivide the group into 4 subgroups for better organization of the discussion.

Questions for discussion:

1. Where do banks get their money?

2. How has the mix of bank deposits changed in recent years?

3. Expand on the difference between deposit-making practice in the U.K. and the U.S.?

4. Why do most bank analysts anticipate a continuing squeeze on bank profits? What strategies are banks employing to protect their profit margins?

Unit 3. Bank lending Part 1. Reading Practice

Vocabulary notes

to amortize	—1) погашать долг в рассрочку, 2) обеспечивать постепенную выплату займа
repaid by annual installments	— выплаченный в рассрочку
to appraise	— оценивать, определять стоимость
assets	— имущество, достояние, средства; активы; фонды; капитал
fixed assets	— основные средства, основные фонды
current assets	— текущие активы
balance sheet	— балансовый отчет
chattel	— движимое имущество
chattel mortgage (US)	— ипотечный кредит
clear	— осуществлять клиринг векселей, чеков; выплачивать по чеку клиента
to serve as a collateral (security)	— служить имущественным обеспечением, обеспечением ценными бумагами
collateral	— обеспечение; залог; дополнительное обеспечение
debt	—долг, задолженность, обязательство
deed	— документ, скрепленный подписью и печатью
discount	— 1) дисконт, учет векселей, 2) процент скидки, ставка учета
encumbrance	— закладная, долг, обязательство
equity	— 1) маржа, 2) доля акционера в капитале, 3) обыкновенная акция
estate	— имущество, состояние
to estimate	— 1) оценивать, 2) подсчитывать, 3) составлять смету
holding	— 1) владение акциями, 2) пакет акций
holdings	— вклады, авуары
indebtedness	— задолженность
installment	—1) очередной взнос, 2) частичный платеж
liabilities	— денежные обязательства
to liquidate	— ликвидировать, погашать
mortgage	— ипотека; залог; закладная
net value, net worth (US)	— чистая стоимость компании; собственный капитал
obligation	— долговое обязательство; облигация
to pledge	— закладывать
property	— 1) собственность, 2) имущество
real estate (US)	— недвижимость
to retire	— погашать долговое обязательство
securities	— ценные бумаги, фонды
title	— право собственности
trust	— 1) траст, доверительный фонд, 2) кредит давать в кредит
trust deed (US)	— акт учреждения доверительной собственности
to meet a loan	— погашать ссуду