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US Banking Today
14 Key Points
12
Economics
12th Grade
04/19/2012

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Cards

Term
Commercial Banks
Definition
Lend money, accept deposits, and transfer money among businesses, other banks and financial institutions, and individuals.
*Widest range of services, but huge on loans
Term
Saving and Loan Assiciations
Definition
established to lend money and accept deposits.Called "thrifts." Began as "home-building societies"---take money and borrow it then pay it back
Term
Mutual Savings Banks
Definition
serve people who wished to make small deposits that large banks did not want to handle...interest rates slightly lower
Term
Credit Unions
Definition
when members deposit money, they purchase shares to pay interest. Use this savings pool to supply low-cost loans to members...high interest rates.
Term
Automated Teller Machines
Definition
ATM's. Make deposits or withdrawals from checking and savings accounts. Make payments or transfer money.
Term
Automatic Clearing House Services
Definition
Banks transfer money automatically...without writing checks. Transfers money from customer to his/her creditors
Term
Point-of-Sale Transactions
Definition
direct transfer of money from buyer's bank account to seller's bank account. Debit Card. PIN number. Grace Period.
Term
Home Banking
Definition
Internet. Telephone. Transfer money, set up accounts, apply for loans...etc
Term
Deregulation
Definition
Reduction of government restrictions. More competition in banking.Regional Banking--banks can merge with other banks and build branch offices in other states.
Term
Loan Defaults
Definition
Failure to make payments on a loan. Farmers--FCS--went bankrupt.
Term
Bank Failures
Definition
Loan defaults and bank failures...Great Depression...doesn't have enough assets to cover its accounts.
Term
Savings and Loans in Crisis
Definition
Borrowers failed to make payments on loans, some S&Ls failed and others taken over by larger banks. Only had private insurance led to failure...Financial Institutions REform, Recovery, and Enforcement Act--abolished FSLIC and established the REsolution Trust Corporation to stabilize.
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