College of Arts and Sciences
San Isidro Campus
COMPARISON OF BANKING STRUCTURE IN THE UNITED STATES AND ABROAD
A Case Study Presented to
The Faculty of College and Arts and Sciences
In Partial Fulfillment of the Requirement for the Subject
Finance I (Principles of Money, Banking and Credit)
During the First Semester of A.Y. 2011-2012
Pangilinan, Mark Allan C.
Dela Cruz, Jennica
Gonzales, Anna Patricia
Miranda, Donna Mae
October 01, 2011
Comparison of Banking Structure in the United States and Abroad
The structure of the commercial banking industry in the United States is radically different from that in other industrialized nations. The United States is the only country that is just now developing a true national banking system in which banks have branches throughout the country. One result is that there many more banks in the United States then in other industrialized country. In contrast to the United States, which has on the order of 8, 100 commercial banks, every other industrialized country has well under 1, 000. Japan. For example, have fewer than 100 commercial banks – a mere fraction of the number the United States, even though its economy and population are half the size of the United States. Another result of the past restriction on branching in the United States is that our banks tend to be much smaller than in other countries.
Central Banking System plays a very important role in every country and it is also concern in the growth and development of one country. Let us first discuss the real importance of having central banking system.
The importance of Central Banking system, first is to provide the nation’s money supply, more active duties include controlling the interest rate and acting as a lender last resort to the banking sectors during the times of financial crisis. It may also have supervisory power, intended to prevent banks and other financial institutions from reckless and fraudulent behavior central bank in most developed nation are independent.
Second, central banking system majority function is to implement monetary policy, determining interest rate, controlling the nation’s entire money supply, managing foreign exchange and the Government stock register. And lastly, to regulate and supervising the banking industry.
In this case study, we determine the effectiveness of having central banking system and to know how some industrialized country exists, in terms of banking system.
I. Case Title
“Comparison of Banking Structure in the United States and Abroad”
II. Point of View
Banking System of the Philippines
III. Definition of Terms
1. Central Banking System – in the United States is known as the Federal Reserve System (commonly known as the “FED”) which composed of 12 regions Federal Reserve Bank located in major cities throughout the country. It is a public institution that usually issues the currency, regulates the money supply and controls the interest rates in a country. 2. Money Supply- is the total amount of money available in an economy at a particular point of time. 3. Interest Rules- are methods for estimating an investment doubling time. These are fairly complex and have been subject to numerous changes and modification. 4. Lender of Last Resorts- is an institution willing to extend credit when no one else will. 5. Financial Institution- that provides financial services for its clients or members 6. Stock Register- register maintained by the stores in charge to record all the receipts and issues of the stock items 7. Foreign Exchange- may...