Функция банка правительства

Независимо от принадлежности капитала центральные банки тесно связаны с государством. Центральный банк выступает в качестве банкира правительства, его кассира, кредитора, финансового консультанта. В центральном банке открыты счета правительства и правительственных ведомств.

Доходы правительства, поступившие от налогов и займов, зачисляются на беспроцентный счет министерства финансов в центральном банке, все правительственные расходы покрываются с этого счета.

Центральный банк кредитует государство, консультирует Минфин по вопросам размещения и погашения государственных займов, выбора дат эмиссии и определения доходности государственных ценных бумаг в зависимости от рыночной ситуации, управляет государственным долгом.

Под управлением государственным долгом понимаются операции центрального банка по размещению и погашению займов, организации выплат доходов по ним, проведению конверсии и консолидации.

Все функции центрального банка взаимосвязаны. Кредитуя государство и банки, он одновременно создает кредитные орудия обращения, осуществляя выпуск и погашение правительственных обязательств, воздействует на уровень ссудного процента.

Это определяет особое положение, которое занимает центральный банк в банковской системе, и создает объективные предпосылки для выполнения им своей важнейшей функции – функции денежно-кредитного регулирования.

Read the text, try to catch its essentials and be ready to do the tasks.

Text b global banking industry

Worldwide assets of the largest 1,000 banks grew 16.3% in 2006/2007 to reach a record $74.2 trillion. This follows a 5.4% increase in the previous year. EU banks held the largest share, 53%, up from 43% a decade earlier. The growth in Europe’s share was mostly at the expense of Japanese banks, whose share more than halved during this period from 21% to 10%. The share of US banks remained relatively stable at around 14%. Most of the remainder was from other Asian and European countries.

The United States has by far the most banks in the world, both in terms of institutions (7,540 at the end of 2005) and branches (75,000). This is an indicator of the geography and regulatory structure of the USA, resulting in a large number of small to medium-sized institutions in its banking system. Japan had 129 banks and 12,000 branches. In 2004, Germany, France, and Italy each had more than 30,000 branches – more than double the 15,000 branches in the UK.

Bank crisis. Banks are susceptible to many forms of risk which have triggered occasional systemic crises. These include liquidity risk (where many depositors may request withdrawals beyond available funds), credit risk (the chance that those who owe money to the bank will not repay it), and interest rate risk (the possibility that the bank will become unprofitable, if rising interest rates force it to pay relatively more on its deposits than it receives on its loans).

Banking crises have developed many times throughout history, when one or more risks have materialized for a banking sector as a whole. Prominent examples include the bank run that occurred during the Great Depression, the U.S. Savings and Loan crisis in the 1980s and early 1990s, the Japanese banking crisis during the 1990s, and the subprime mortgage crisis in the 2000s.

Profitability. A bank generates a profit from the differential between the level of interest it pays for deposits and other sources of funds, and the level of interest it charges in its lending activities. This difference is referred to as the spread between the cost of funds and the loan interest rate. Historically, profitability from lending activities has been cyclical and dependent on the needs and strengths of loan customers. In recent history, investors have demanded a more stable revenue stream and banks have therefore placed more emphasis on transaction fees, primarily loan fees but also including service charges on an array of deposit activities and ancillary services (international banking, foreign exchange, insurance, investments, wire transfers, etc.). Lending activities, however, still provide the bulk of a commercial bank's income.

In the past 10 years American banks have taken many measures to ensure that they remain profitable while responding to increasingly changing market conditions. First, this includes the Gramm-Leach-Bliley Act, which allows banks again to merge with investment and insurance houses. Merging banking, investment, and insurance functions allows traditional banks to respond to increasing consumer demands for "one-stop shopping" by enabling cross-selling of products (which, the banks hope, will also increase profitability). Second, they have expanded the use of risk-based pricing from business lending to consumer lending, which means charging higher interest rates to those customers that are considered to be a higher credit risk. This helps to offset the losses from bad loans, lowers the price of loans to those who have better credit histories, and offers credit products to high risk customers who would otherwise been denied credit. Third, they have sought to increase the methods of payment processing available to the general public and business clients. These products include debit cards, prepaid cards, smart cards, and credit cards. They make it easier for consumers to conveniently make transactions and smooth their consumption over time (in some countries with underdeveloped financial systems, it is still common to deal strictly in cash, including carrying suitcases filled with cash to purchase a home). However, with convenience of easy credit, there is also increased risk that consumers will mismanage their financial resources and accumulate excessive debt. Banks make money from card products through interest payments and fees charged to consumers and transaction fees to companies that accept the cards.

Because debt is necessary to create money in the first place, we are regularly assaulted by advertisements encouraging us to get in debt. Furniture and car stores advertise sales requiring no down-payments and even 'cash-back.' Credit card offers arrive in our mailboxes each week, especially to those of us who are in debt to other credit cards. After all, the credit card companies would soon go out of business if we all paid our bills on time. Banks and credit unions offer mortgages and other loans. And everywhere we are encouraged to 'Buy, buy, buy!'

It is not only individuals who are encouraged to contribute to the economy through indebtedness. During the 1970s Canadian banks were awash with the profits of the oil boom in the Middle East. Since the system grinds to a halt when money is just sitting in the bank, bankers actively sought borrowers for this money. Developing countries in Africa, Asia, and Central and South America seemed like good targets; billions of dollars were lent for health care, education, infrastructure, and social programs. At the time interest rates were low. However, in the 1980s interest rates soared, and by the 1990s, borrowing countries were so far in debt that their indebtedness started to have devastating effects on citizens. Social programs were cut and money for health and education disappeared. As a result many of these countries' citizens experience a much lower standard of living today than they did in the 1960s. And as interest payments started to exceed the amount of the actual loans, countries were caught in a devastating cycle. Between 1981 and 1997 indebted countries paid over US$2.9 trillion in interest and principal payments. While countries like Canada pride themselves in the charity and aid they provide to the third world, what most people do not know is that aid-receiving countries pay back more in repayments and interest to industrialized countries than they receive in foreign aid. For every $1 that Northern countries provide in aid, over $3 comes back in the form of debt servicing.

Copy out the topic sentence in each paragraph that could be useful for composing a plan to the text.

Write a brief summary of the text. Use the following key-patterns:

1. The text deals with….. .

2. It considers ….. .

3. The explanation of some facts ….. is given.

4. The text gives definitions of some economic terms like ….. .

5. The policy of ….. connected with ..... is described.

6. Some interesting facts about ….. are paid attention to.

Give the Russian equivalents to the following.

Worldwide assets, at the expense of banks, remained relatively stable, resulting in a large number of small to medium-sized institutions, susceptible to risks, to trigger occasional systemic crisis, withdrawals beyond available funds, stable revenue stream, the spread between the cost of funds and the loan interest rate, to take many measures, responding to increasingly changing market conditions, charging higher interest rates, increased chance of default on loans, to offset the losses from bad loans, mismanage their financial resources, no down-payments and even 'cash-back'.

Translate 2 paragraphs into Russian beginning from “In the past 10 years American banks …”

Answer the questions.

1. What is the tendency of worldwide assets growth of the largest countries?

2. What could be different bank risks?

3. What is the source of bank profitability?

4. What measures did American banks take to remain profitable?

5. What is risk-based pricing?

6. What do banks do to make transactions easier?

7. What are the disadvantages of easy credits?

8. What are the results of some international bank activities?

Summarize the main information of the text and render it.

Look through the text and fill in the gaps with the words given below.

Banks compete with each other for both loans and deposits. Before 1980, legal ceilings on deposit interest restricted competition for deposits, but now ..(1).. rates on certificates of deposits, savings accounts, and even checkable deposits are ..(2).. . Because banks’ profit margins depend on the ..(3).. between the interest they earn on their loans and other assets and what they ..(4).. for deposits, the two move together.

Banks ..(5).. with other financial institutions and with open financial markets. Corporations borrow ..(6).. only from banks but also from other financial intermediaries: ..(7).. companies, pension funds, and investment companies. They sell bonds, ..(8).. , and commercial paper in open markets, where the buyers include individuals, nonprofit ..(9).. , and mutual funds, as well ..(10).. banks. Households and businesses compare the returns and advantages of bank deposits ..(11)..those of money market funds, other mutual funds, open-market securities, and other ..(12).. .

Thanks to its control of money markets and ..(13).. , the Fed influences interest rates, asset prices, and credit flows throughout the ..(14).. system. Arbitrage and competition spread increases or ..(15).. in interest rates under the Fed’s direct control to other markets. Even stock prices are sensitive, falling when yields on bonds go up, and rising when they fall.

Interest, pay, unregulated, financial, compete, decreases, not, stocks, difference, insurance, with, institutions, as, banks, assets.

Render the text into English.