FINS 3650 Lecture 1 & Readings
• Banks main business is taking risk.
• Banks exist to transform assets in terms of their asset class, maturity, liquidity, credit risk and quality.
• Banks also help facilitate the flow of funds between the surplus and deficit units.
• The banking system works on confidence as when there is no trust between the parties they will start withdraw the deposits, consequently causing the bank to collapse. People must hold no doubt and believe that the bank is safe
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