Exam 14: Banking and Financial Services: Regulations, Operations, and Trends

Construct the report of condition (balance sheet) for First National Bank for December 31 of the year just ended from following information.

Loans granted to finance the purchase of buildings, machinery and equipment are called working capital loans.

The U.S. banking system is moving toward consolidation which means:

No U.S. banks are permitted to offer investment banking services involving corporate securities inside the United States.

The money position of a bank involves its legal reserves.

The FDIC Improvement Act in 1991 granted the Federal Deposit Insurance Corporation authority to close the U.S. offices of foreign banks if these are operated in an unsafe manner.

A relatively new fund-raising device used by banks and a few other financial intermediaries in recent years in which better quality loans are packaged into asset pools as collateral for bank security issues sold to investors is known as:

The structural change which makes banking organizations looking more and more like other financial-service providers is called:

For the EC (European Community), conversion to the Euro will offer the following benefits:

The most important security held in U.S. bank investment portfolios today is:

The banking system can create money only dollar for dollar with the amount of excess reserves in the banking system.

According to the text, which of the following is not a permissible activity for bank holding companies?

Vault cash held by a depository institution does not count as part of the legal reserves of a U.S. depository institution.

From 1975 to year 2000, the number of U.S. commercial banks and the average size of a U.S. bank have changed as follows:

The banking system can take a given volume of cash reserves and:

Recent problems in the financial system will likely cause bank consolidation to:

The allowance for loan and lease losses (ALL) is a:

The number and different sizes of commercial banks in a given community or market area is referred to as:

Lease financing by commercial banks generally carries a higher yield to banks than direct loans but lacks any tax advantage as direct loans do.

Primary reserves are the banker's first line of defense against withdrawals.