Commercial Banks in The Philippines
Commercial Banks in The Philippines
Commercial Banks in The Philippines
THE PHILIPPINES
AND
ITS FUNCTIONS
“BANKS” – entities engaged in the lending of funds in the form of deposits.
COMMERCIAL BANK
CHAPTER IV
Commercial Banking Corporations
• SAVINGS DEPOSITS
- Money can be deposited at anytime but the
maximum cannot go beyond a certain limit.
• CASH CREDIT
-> The bank gives loans to the borrowers, but under emergency cash will be given.
-> It is a paper asset signed by the debtor and the creditor for a fixed amount payable on a fixed date.
• MONEY AT CALL
-> “call money”
• TERM LOANS
-> Provides capital funds to the borrowers; maturity period varies from 1 - 10 years.
-> Sometimes, two or more banks may jointly provide large term loans to the borrowers – Participation loans or
Consortium finance
• CONSUMER CREDIT
-> for consumer goods or hospital bills; repayable in installment for a short period of time.
SECONDARY
FUNCTIONS
• AGENCY SERVICES
a) Locker Facility
c) Letter of Credit
d) Collection of Statistics
e) Gift Cheques
THE DEPOSIT FUNCTION
WHAT ARE DEPOSITS?
○ Bank can lend deposits while depositor does not claim these yet
and earn interest on loans granted.
WHAT ARE DEPOSITS?
• DEMAND DEPOSITS
● TIME DEPOSITS
- Neither all nor part may be withdrawn before maturity date or at least
upon due notice of 30 days.
METHOD OF WITHDRAWAL
3. Savings Deposits
- Evidenced by a passbook
● BSP sets minimum and maximum percentages which banks can offer
to customers.
WAY DEPOSIT IS CREATED
● DERIVATIVE DEPOSITS
- From proceeds of loans; bank places the loan proceeds under a current
account from which he can draw checks eventually
● More deposits -> more available loanable funds (can earn interest)
BANKS = Lifeblood