An Overview of Banks and

Financial Services Sector

Bank Management and Electronic Banking

Powerful Forces Reshaping

The industry is consolidating rapidly with
Banking
and Financial
substantially fewer, but much larger,
Services
banks and other financial firms.
Rapidly globalizing and experiencing
intense competition in marketplace.
Financial heavyweights are all
converging toward each other.
Undergoing technological revolution.

The Financial System and

Competing
FinancialRoles of the Financial
System Service
Institutions
Encourage individuals and institutions to save
To transfer those savings to those individuals
and institutions planning to invest in new
projects.
Provides variety of supporting services
essential to modern living. These includes:
Payment Service, Risk protection Services,
Liquidity Services and Credit Services.

The Financial System and Competing

Financial- Service Institutions (Cont.)
Leading Competitors with Banks
Saving Associations
Credit Unions
Money Market Fund

The Financial System and Competing

Financial- Service Institutions (Cont.)
Leading Competitors with Banks
Mutual Funds (investment companies)
Hedge Funds
Security Broker and Dealer

The Financial System and Competing

Financial- Service Institutions (Cont.)
Leading Competitors with Banks
Investment Banks
Finance companies
Financial Holding Companies

The Financial System and Competing

Financial- Service Institutions (Cont.)
Leading Competitors with Banks
Life and Property/ Casualty insurance
companies

The Many Different Roles

Banks and their Competitors
The intermediation role
Play
The

payment role
The guarantor role
The risk management role
The investment baking role
The saving/investment advisor role
The safekeeping/certification of value role
The agency role
The policy role

Services Bank Many Closest

Competitors Offer the Public

Services Bank Have Offered throughout

History
Carrying Out Currency Exchanges
Discounting Commercial Notes and Making
Business Loans
Offering Savings Deposits
Safekeeping of Valuable and Certification of
Value
Supporting Government Activities with Credit
Offering Checking Accounts ( Demand Deposits)
Offering Trust Services

Services Bank Many Closest

Competitors Offer the Public

Services Bank and Many of Their Closest

Competitors have Offered More Recently
Granting Consumer Loans
Financial Advising
Managing Cash
Offering Equipment Leasing
Making Venture Capital Loans
Selling Insurance Policies
Selling Retirement Plans

Services Bank Many Closest

Competitors Offer the Public
Dealing in Securities: Offering Security
Brokerage and Investment Banking
Services
Offering Mutual Funds and Annuities
Offering Merchant Banking Services
Offering Risk Management and Hedging
Services
Convenience: The Sum Total of All
banking and Financial Services

Key Trends Affecting All

Financial-Service Firms
Service

Proliferation
Rising Competition
Government Deregulation
An Increasingly Interest-Sensitive Mix of
Funds
Technological Change and Automation
Consolidation and Geographic Expansion
Convergence
Globalization