Managerial Finance

Course : Managerial Finance Lecture : Marc Credit Hours : 3 Credits Semester Sessions : 3 Semester, 2021/2022 Session Prepared By : Kenzo LECTURE NOTES Understanding Banks Hearing the word bank is actually familiar to us, especially those who live in urban areas. Even in rural areas Currently the word bank is not a foreign and strange word. When everyone mentions the word bank, they always associate it with money, so there is always the assumption that it is related with banks always has something to do with money. Bank comes from the Italian word banco which means bench. Seat This is what bankers use to serve activities operations to customers. The official term bench and popular as a bank. Banks are industrial companies services because the product only provides services to public. In simple terms, banks can be interpreted as financial institutions whose business activity is collecting funds from the community and channel these funds back to community and provide other banking services. Whereas The definition of a financial institution is any company that engaged in the financial sector where the activities are only collect funds or only distribute funds or both both. There are several other definitions of banks put forward by law and banking experts, including: following: 1. Law No. 7 of 1992 concerning Banking which has been amended with Law No. 10 of 1998, reads:  Banks are business entities that collect funds from community in the form of savings and distribute them to the community in the form of credit or other forms other forms in order to improve the standard of living many people.  Banking is all about everything about banks, covering institutions, business activities, as well as methods and processes for carrying out activities his business.  Commercial Banks are banks that carry out activities business conventionally or based on principles sharia which in its activities provides services in payment traffic. 2. Prof G.M Verryn Stuar Bank is a company who satisfied other people by giving a credit with the money they accept as a gamble to the other, even though they should supply the new money, meaning the bank is a body business whose form is to satisfy the needs of other people, with provide credit in the form of money received from people otherwise, even by issuing new paper money or metal. 3. Dr. B.N Ajuha Bank provided means by which capital is transferred from those who cannot use it profitably to those who can use it productively for the society as a whole. Bank provided which channel to invest without any risk and at a good rate of interest means the bank channeling capital from those who cannot use it profitably to those who can make it more productive for the benefit of society. Banks matter too channel to invest savings safely and with attractive interest rates. 4. Drs. Malayu S.P Hasibuan  Commercial banks are financial institutions, creators of money, fund collector, credit distributor, monetary stability, as well as a dynamist of economic growth.  Bank is a financial institution means bank is a business entity whose assets are primarily in the form of financial assets (financial assets) and are profit-motivated and also social, so it's not just looking for profit just.  Banks are the creators of money intended that banks are creating demand deposits and circulating currency.  Banks are fund collectors and significant credit distributors banks in their operations collect funds to surplus spending units and channeling credit to unit spending deficit.  Banks as monetary stability are defined as banks has an obligation to participate in stabilizing value exchange of money, exchange rates or relative prices of goods stable or fixed.  Banks as economic dynamists, that is that banks are the center of the economy, a source funds, productive savings and incentives progress of national and international trade. Without the role of banking, globalization is impossible economy.