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Functions of Banks and Regulatory Insights

A commercial bank only performs basic banking services like deposits, loans, currency exchange. A universal bank performs both commercial and investment banking, including underwriting securities. Some government banks in the Philippines include the Development Bank of the Philippines, Land Bank of the Philippines, and Philippine Al-Amanah Islamic Investment Bank. Cooperative banks are not thrift banks, and rural banks cater to farmers, small businesses and cottage industries in rural areas. The Bangko Sentral ng Pilipinas, Securities and Exchange Commission, and Insurance Commission are working to align their policies with global standards. Current risks in the Philippine financial system include repricing, refinancing and repayment risk.

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239 views1 page

Functions of Banks and Regulatory Insights

A commercial bank only performs basic banking services like deposits, loans, currency exchange. A universal bank performs both commercial and investment banking, including underwriting securities. Some government banks in the Philippines include the Development Bank of the Philippines, Land Bank of the Philippines, and Philippine Al-Amanah Islamic Investment Bank. Cooperative banks are not thrift banks, and rural banks cater to farmers, small businesses and cottage industries in rural areas. The Bangko Sentral ng Pilipinas, Securities and Exchange Commission, and Insurance Commission are working to align their policies with global standards. Current risks in the Philippine financial system include repricing, refinancing and repayment risk.

Uploaded by

elaine
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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1. Compare the function of a commercial bank with the functions of a universal bank.

Commercial banks only performs mandatory services like accepting drafts and issuing letters
of credit, discounting and negotiating promissory notes, drafts and bill of exchange, and other
evidences of debt, accepting or creating demand deposits, receiving other types of deposits and
deposit substitutes, buying and selling foreign exchange, and gold and silver bullions, acquiring
marketable bonds and other debt securities, and extending credit subject to such rules that the
monetary board may promulgate. While Universal bank performs both commercial bank functions
and investment bank functions. Universal banks are also authorized to engage in underwriting and
other functions of investment houses, and to invest in equities of non-allied undertakings.

2. Enumerate 3 government banks


A. Development Bank of the Philippines
- Provides loans for developmental purposes
- Gives loans to agricultural, commercial, and industrial sector
B. Land Bank of the Philippines
- Provides support for the implementation of Agrarian Reform Program
C. Philippine Al-Amanah Islamic Investment Bank
- Promote and accelerate the socio economic development of the autonomous region of
Mindanao
3. Cooperative bank is not a thrift bank
4. Rural Bank caters to farmers businessmen and cottage industries in the rural areas
5. Philippine National Bank is not a government bank
6. Bureau of Internal Revenue is not a government agency that regulates financial institutions
7. Explain briefly hoe the following regulatory agencies intend to align their policies, roles and
practices with global standards.
A. BSP- released Circular No. 975 to streamline the requirements on the issuance of bonds and
commercial papers and Circular No. 984 & 985 in futherrance of liberalizing the foreign
exchange regulatory framework.
B. SEC- studying the ideal regulatory treatment of virtual currencies from the perspective of
investor protection.
C. Insurance Commission- adoption of international reporting practices
8. Discuss briefly the following current risks in the Philippine Financial System
A. Repricing, Refinancing and repayment risk
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