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    Basic Microeconomics

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    Llyuane Austine Zuño
    This document discusses types of banks and functions of money in the Philippines. It identifies 7 types of banks - universal banks, commercial banks, thrift banks, rural banks, cooperative banks, Islamic banks, and microfinance banks. Thrift banks are further broken down into 5 sub-types. The 3 main functions of money are also outlined as a medium of exchange, unit of account, and store of value. Money is defined in economics as anything generally accepted as payment or repayment, though not all financial assets are considered money.

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    Basic Microeconomics

    Uploaded by

    Llyuane Austine Zuño
    25 views5 pages
    This document discusses types of banks and functions of money in the Philippines. It identifies 7 types of banks - universal banks, commercial banks, thrift banks, rural banks, cooperative banks, Islamic banks, and microfinance banks. Thrift banks are further broken down into 5 sub-types. The 3 main functions of money are also outlined as a medium of exchange, unit of account, and store of value. Money is defined in economics as anything generally accepted as payment or repayment, though not all financial assets are considered money.

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    This document discusses types of banks and functions of money in the Philippines. It identifies 7 types of banks - universal banks, commercial banks, thrift banks, rural banks, cooperative banks, Islamic banks, and microfinance banks. Thrift banks are further broken down into 5 sub-types. The 3 main functions of money are also outlined as a medium of exchange, unit of account, and store of value. Money is defined in economics as anything generally accepted as payment or repayment, though not all financial assets are considered money.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    25 views5 pages

    Basic Microeconomics

    Uploaded by

    Llyuane Austine Zuño
    This document discusses types of banks and functions of money in the Philippines. It identifies 7 types of banks - universal banks, commercial banks, thrift banks, rural banks, cooperative banks, Islamic banks, and microfinance banks. Thrift banks are further broken down into 5 sub-types. The 3 main functions of money are also outlined as a medium of exchange, unit of account, and store of value. Money is defined in economics as anything generally accepted as payment or repayment, though not all financial assets are considered money.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 5

    OSIAS COLLEGE INC.

    F. TANEDO ST. SAN NICOLAS TARLAC CITY

    WRITTEN
    REPORT
    IN
    BASIC
    MICROECON
    OMICS
    SUBMITTED BY:
    FERIA, MARK ANGELO
    DE LEON, NESTOR
    SANTULLO, REYNALYN
    CERENEO, ELEANOR

    SUBMITTED TO:
    Mrs. MELINDA ABEJUELA
    TYPES OF BANKS AND FUNCTIONS OF MONEY
    What is Bank?

    The term Bank is derived from the French word BANCO which means a bench or money exchange
    table. A bank is a financial institution licensed to receive deposits and make loans. Banks may also
    provide financial services such as wealth management, currency exchange, and safe deposit boxes. 

    THE BANKING SYSTEM IN THE


    PHILIPPINES
    REYES (2003) classified banks
    according to function, size and scope
    of services being offered. Based on these criteria, banks are grouped into universal banks, commercial
    banks, thrift banks, rural banks, cooperative banks, Islamic banks and microfinance banks.

    TYPES OF BANKS IN THE PHILIPPINES


     UNIVERSAL BANKS - are banks vested with the authority to exercise, in a addition to the powers
    of an investment house and the power to investing the equities of allied and non- allied
    enterprises as may be determined by the BSP. The minimum capitalization for universal banks is
    P4.95 billion.
     COMMERCIAL BANKS- are banking entities which, in addition to the general powers incident to
    corporations are authorized to carry on the business of commercial banking namely.

    a. Accepting drafts and issuing letters of credit

    b. Discounting and negotiating promissory notes, drafts, bills, or exchange and other evidences of
    debts;

    c. Accepting or creating demand deposits;

    d. Receiving other types of deposits and deposits substitutes;

    e. Buying and selling foreign exchange and gold or silver bullion;

    f. Acquiring marketable bonds and other debt securities; and

    g. Extending credit subject t the rules the BSP may promulgate.

     THRIFT BANKS- are banks established primarily to mobilize small savings and provide loans at
    generally longer and easier terms. They cater to small and medium enterprises and have a
    minimum capitalization of P52 million (outside Metro Manila) and P325 million (within Metro
    Manila).

    TYPES OF THRIFT BANKS


    1. SAVINGS BANKS - are banks organized for the purpose of accumulating savings, deposits, and
    investing them for specified purposes.
    2. PRIVATE DEVELOPMENT BANKS- are banks that are organized primarily to cater to the capital
    needs and demand for investment credit or medium to long – term loans for the promotion of
    growth of industry and agriculture at reasonable costs.
    3. STOCK SAVINGS AND LOAN ASSOCIATION- are institutions engaged in the accumulation of
    savings mainly of stockholders in specified undertakings. They are primarily concerned with
    servicing the needs of the household by providing personal finance and long – term financing for
    home building and development.
    4. RURAL BANKS- are banks which are largely privately – owned that provide credit facilities to
    farmers and merchants, or their cooperatives and in general, to the people of rural
    communities. The minimum capitalization for this type of bank is P2.6 million (5th/6th class
    municipalities) and P26million (within Metro Manila).
    5. COOPERATIVE BANKS- are duly registered associations of person who voluntarily joined
    together with a common bond of interest to achieve a lawful, common, social, or economic end,
    and to make equitable contributions to the capital required and accept a fair share of the risks
    and benefits of the undertaking in accordance with universally accepted cooperative principles.
    6. ISLAMIC BANKS- are banks established to promote and accelerate the socio- economic
    development particularly of the Autonomous Region of Mindanao by performing banking,
    financing and investment operations and to establish and participate in agricultural, commercial
    and industrial ventures based on the Islamic concept of banking. All business dealing and
    activities of Islamic banks are subject to the basic principles and rulings of Islamic Sharia within
    the purview of the aforementioned declared policy.
    7. MICROFINANCE BANKS- are banks that are provide a broad range of financial services such as
    deposits, loans, payment services, money transfers and insurance products to the poor and low-
    income households for micro enterprises and small businesses. These banking services are
    aimed at enabling the poor and low- income households to raise their income levels and
    improve their living standards (Reyes 2003).

    FUNCTIOS OF MONEY

    1. MEDIUM OF EXCHANGE- When money is used to intermediate the exchange of goods and
    services, it is performing a function as a medium of exchange.

    2. UNIT OF ACCOUNT- It is a standard numerical unit of measurement of market value of


    goods, services, and other transactions. It is a standard of relative worth and deferred
    payment, and as such is a necessary prerequisite for the formulation of commercial
    agreements that involve debt. To function as a unit of account, money must be divisible into
    smaller units without loss of value, fungible (one unit or piece must be perceived as
    equivalent to any other), and a specific weight or size to be verifiably countable.
    3. STORE OF VALUE- To act as a store of value, money must be reliably saved, stored, and
    retrieved. It must be predictably usable as a medium of exchange when it is retrieved.
    Additionally, the value of money must remain stable over time.

    CONCEPT AND FUNCTIONS OF MONEY

    Money is defined in many different ways. In economics, Tetangco (2003) defined money as
    traditionally as anything that is generally accepted as payment for goods and services or as
    repayment for depts. Money is defined as “nothing other than a transferable
    acknowledgement of debt, a promise to pay, arbitrarily created and usually with an
    indeterminate maturity and exchange value. As a financial asset, money presents a claim
    against income or wealth of a business firm, household or unit of government, represented
    usually by a certificate, receipt or other legal documents .However, not all financial assists
    can be classified as money. For example, stocks and debt scariness do not necessarily
    constitute the broad definition of money since these assets do not perform the other
    functions of money such as serving as a unit of account moreover, stocks and similar assets
    do not have the liquidity feature of money because these assets are not easy to exchange
    for cash or for other goods and services..

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