Commercial Bank Activities

Course : Managerial Finance Lecture : Marc Credit Hours : 3 Credits Semester Sessions : 3 Semester, 2021/2022 Session Prepared By : Kenzo LECTURE NOTES Commercial Bank Activities Commercial banks or better known as banks Commercial banks are the most widely circulated banks Indonesia. Commercial banks also have various advantages if compared to BPR, both in terms of variety of services and the scope of its operational area. This means commercial banks.has the most complete and possible service provision activities operate throughout Indonesia. In practice, the variety of products depends on the bank's status concerned. According to status, commercial banks are divided into: two types, foreign exchange commercial banks and non-foreign exchange commercial banks. Each Each status provides different services. Commercial banks For example, foreign exchange has the most complete number of services.such as being able to carry out service-related activities.overseas. Meanwhile, nonforeign exchange commercial banks can do the opposite providing services related to foreign countries. Commercial bank activities completely include activities as follows: 1. Collecting funds (funding) The activity of collecting funds is a purchasing activity funds from the community. This activity is also known as activity funding. The activity of purchasing funds can be done by: offers various types of savings. Savings are often mentioned with the name of the account or accounts. Types of savings currently available are: a. Current Account Savings (Demand Deposit) Current account savings are deposits at banks and Withdrawals can be made using checks or giro bills. Each checking account holder will be given interest known as giro services. The amount of giro services depending on the bank in question. Regular checking account used by entrepreneurs, both individuals and his company. For banks, current account services are cheap funds because the interest given to customers is relatively lower from interest on other savings. b. Savings Deposits Represents deposits in banks with appropriate withdrawals with the requirements set by the bank. Withdrawal savings are made using savings books, withdrawal slips, receipt or automated teller machine (ATM) card. To Savings account holders will be given savings interest which is a service for his savings. Just like that with a checking account, the amount of savings interest depends on the bank concerned. In practice, the interest on savings is more big from giro services. c. Deposit Savings (Time Deposit) Deposits are savings that have a term certain (maturity). Withdrawals are carried out over a period of time the. However, currently there are banks that provide facilities deposits from which withdrawals can be made at any time. However Currently there are banks that provide deposit facilities Withdrawals can be made at any time. Type of deposit vary according to customer wishes. In practice Types of deposits consist of time deposits, certificates of deposit and deposit on call. 2. Distribute Funds (Lending) Channeling funds is an activity of selling funds successfully collected from the community. This activity is known as name of lending activity. Fund distribution carried out by the bank carried out through the provision of loans within the community better known as credit. Credit provided by Banks consist of various types, depending on the ability of the bank that distributes them. Likewise with the amount as well interest rate offered. Before the credit is disbursed, the bank first assesses it credit worthiness submitted by the customer. This eligibility covers various aspects of assessment. The credit recipient will credit interest is charged, the amount of which depends on the bank channel. The size of the credit interest is very influential bank profits, considering that the main profit of banks is from the difference between credit interest and savings interest. In general, the types offered include: a. Investment Credit Namely, it is credit given to entrepreneurs those who make investments or invest capital. Usually This type of credit has a relatively long term i.e. over 1 (one) year. Examples of this type of credit are credit to build a factory or buy equipment factories like machines. b. Working capital credit This is credit used as business capital. Usually this type of credit has a short term, that is, no more than 1 (one) year. An example of this credit is for buying raw materials, paying employee salaries and capital other work. c. Trade credit Is a credit given to traders in order to expedite or expand or expand its trading activities. Examples of types of credit This is a credit for purchasing merchandise given to suppliers or agents. d. Productive credit Is credit which can be in the form of investment, capital work or trade. In the sense that this credit is given to try again so that the credit is returned expected from the results of the financed business. e. Consumer credit This is credit used for personal needs for example, consumption needs, whether food, clothing or other things board. Examples of this type of credit are housing loans, motor vehicle loans, all of which are for use Alone. f. Professional credit Is a credit given to groups professionals such as lecturers, doctors or lawyers.