...Sample Notice in case of Cheque Bouncing Important points 1. Cheque Bouncing is a quasi criminal matter covered under Sec. 138 of Negotiable Instruments Act. 2. Conviction under this section may incurr prison sentence. 3. However, before a law suit can be filed, the receiver of the cheque must send a notice to the cheque issuer demanding money. The demand should clearly mention the details of the transaction that obligated the issuer to issue the cheque and the request that the money should be paid within 15 days. 4. The notice must be sent within 30 days of receiving information from the bank that the cheque has been dishonoured. 5. If the payment is not received within 15 days after sending the notice, a law suit can be filed within the next 30 days. 6. For example: * Cheque given on 1/1/2010 * Cheque put up in the bank on 5/1/2010 (cheque must be put up within six months of the date on the cheque). * Bank dishonours the check on 10/1/2010. * Notice demanding money sent on 15/1/2010.(Notice must be sent within 30 days i.e. before 9/2/2010). * Need to wait for payment for 15 days i.e. 30/1/2010 * Law suit may be filed between next 30 days i.e. 1/2/2010 and 2/3/2010. Notice DATE: 25/10/2010 To, Mr. A. B, General Manager, FGH Pvt. Ltd., Indore, MP 452001 Dear Mr. A. B., As per the agreement that we entered with your firm on 10/10/2010, we were to deliver 1000 Kg wheat on or before 20/10/2010 at your...
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...SCHOOL OF ARTS AND HUMANITIES LAW OF BANKING AND FINANCE The essay: Each student must write an essay on: “Will the new “twin –peaks” structure of bank regulation ensure that banking crises will be a thing of the past?” Analyse the new structure introduced by the Financial Services Act 2012 and the approach to be taken by the regulators in regulating banks in the UK. In particular, consider whether the new regulations will make the system more resilient. 12 noon p.m. on 1st April. Submission date: -Your essay must be submitted via Succeed only, by no later than Word count: The essay should not exceed word count, excluding references, 2500-3000 words footnotes, endnotes, and bibliography. You are required to provide a word count. Students who exceed this limit by more than 10% may be awarded a lower grade. The specific aim of the essay is to assess your ability to analyse current issues in banking law, through effective research and writing. In doing so you should demonstrate your skills to : integrate information and materials from a variety of different sources produce a substantially accurate synthesis of relevant doctrinal and policy issues. make a critical judgement of the merits of particular arguments. act independently and with minimal guidance in planning and undertaking tasks. undertake independent research with minimal guidance. understand and make proficient use of the English language in writing in relation to legal matters. present knowledge...
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...BANKING THEORY – LAW AND PRACTICE BBA 2.1 BANKING – THEORY – LAW AND PRACTICE Evolution of Banks – Functions of Commercial Banks – Balance Sheet of Commercial Banks – Credit Creation, Organization and structure of Banks – Unit Banking and Mixed Banking – Public Sector and Private Sector Banks – Nationalization of Commercial Banks – Objects – Progress. Central Bank – Evolution – Functions – Credit Control Measures Money market – Indian money market – Components – Characteristics of developed and under developed money market. Banker and Customer – General and Special relationships – Negotiable instruments – Features – Types of accounts – Types of customers – Pass Book – Cheque – Features – Crossing – Endorsements Paying banker – Duties – Holder in due course – Payment in the due course – Protection – Collecting banker – Duties – Protection Text and Reference Books: 1. Basu : Theory and Practice of Development Banking 2. Muranjan S.K. : Modern Banking in India 3. Reddy & Appanniah : Banking Theory and Practice 4. Natarajan & Gordon : Banking Theory and Practice Lesson – 1 EVOLUTION OF BANKING Evolution of Banking Institutions Origin of the word “Bank”. – Opinion is divided in regard to this. According to some authorities, the work “Bank” itself is derived from the words “bancus” or “banqee,” that is, a bench. The early bankers, the Jews in Lombardy, transacted their business on benches in the market place. When a banker failed...
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...ICB Independent Commission on Banking Final Report Recommendations September 2011 ICB Independent Commission on Banking Final Report Recommendations September 2011 Official versions of this document are printed on 100% recycled paper. When you have finished with it please recycle it again. If using an electronic version of the document, please consider the environment and only print the pages which you need and recycle them when you have finished. © Crown copyright 2011 You may re-use this information (excluding logos) free of charge in any format or medium, under the terms of the Open Government Licence. To view this licence, visit www.nationalarchives.gov.uk/doc/open-governmentlicence/ or e-mail: psi@nationalarchives.gsi.gov.uk. Where we have identified any third party copyright information you will need to obtain permission from the copyright holders concerned. Any enquiries regarding this publication should be sent to: Independent Commission on Banking Victoria House Southampton Row London WC1B 4AD This document is also available from our website at http://bankingcommission.independent.gov.uk/ ISBN 978-1-845-32-829-0 Produced by the Domarn Group, London. Final Report Contents Contents ...................................................................................................................... 1 List of acronyms .........................................................................................
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...American history there has always been a conflict between the federal government intervening in the banking business vs. the Federal government staying out of the banking business * In 1830 when Andrew Jackson (the founder of the Democrat Party) was elected president. He terminated the fed government sponsored US Bank, and resolved the conflict. * The fed government basically stayed out of the banking business until the ’30s, when FDR took office, and the fed government intervened deeply into the ‘banking business,’ which was defined by the IRS, FDIC, Comptroller of the Currency, SEC (if public-owned), and State Bank Supervisors etc. * By defining what the ‘business of banking’s was the statutes, regulations, and enforcement personnel administering these laws, bankers were boxed into doing business as defined by state and federal governments. * Still In present day Banks are financial institutions that hold too much control over the economy and if they fail there are enormous consequences hence the need for government bailouts, in which government financial assistance is provided to banks or other financial institutions who appear to be on the brink of collapse. WHY THE NEED FOR REGULATORS * Bank regulations are a form of government regulation which subject banks to certain requirements, restrictions and guidelines. * To create transparency between banking institutions and the individuals and corporations with whom they conduct business. * To reduce...
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...CAPITAL ADEQUACY FRAMEWORK AND RISK MANAGEMENT IN BANKS GUEST LECTURE: MR. R M PATTANAIK EX GM- INDIAN OVERSEAS BANK CAPITAL ADEQUACY RATIO (CAR) Also known as Capital to Risk (Weighted) Assets Ratio (CRAR) is the ratio of a bank’s capital to its risk. National regulators track a bank's CAR to ensure that it can absorb a reasonable amount of loss and complies with statutory capital requirements. It is a measure of a bank's capital. It is expressed as a percentage of a bank's risk weighted credit exposures. This ratio is used to protect depositors and promote the stability and efficiency of financial systems around the world. Two types of capital are measured: tier one capital, which can absorb losses without a bank being required to cease trading, and tier two capital, which can absorb losses in the event of a winding-up and so provides a lesser degree of protection to depositors. CAR= Capital funds/ Total risk weighted assets (TRWA) WHAT IS RISK? Risk is the possibility of suffering a loss which is UNEXPECTED, UNFORSEEN and UNCERTAIN. Expected losses can be managed and covered by “Provisions” like Loan loss or NPA provisions, Provision for depreciation and investments etc. However, unexpected losses can be taken care by maintaining adequate capital. The capital acts as cushion or shock absorber for the bank in times of unforeseen losses. RISK MANAGEMENT Whatever activities you undertake there is a certain degree of risk associated with it. This risk however...
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...Types of Bank Deposit Accounts a. Demand deposit/current deposit/Checking Account Funds held in an account from which deposited funds can be withdrawn at any time without any advance notice to the depository institution. Demand deposits can be "demanded" by an account holder at any time. Many checking and savings accounts today are demand deposits and are accessible by the account holder through a variety of banking options, including teller, ATM and online banking. there is no limit to the number of transactions a depositor can conduct with these accounts (although a bank may charge a fee for each transaction) A demand deposit is money that you deposit into a bank account from which you can withdraw 'on demand' - at any time without any advance notice to the bank. Common examples of accounts that are often demand deposit accounts include many checking and savings accounts. Keep in mind, however, that not all checking accounts and savings accounts are demand deposit accounts. b. Saving Deposits (local/foreign currency) An account at a bank in which the customer deposits money for any non-immediate use. For example, one may utilize a savings account to save funds for an expensive purchase, such as a house or a car. Because most customers keep money in a savings account for a longer period than a checking account, a savings account pays a slightly higher interest rate. However, the interest rate is not as high as a bond or another low-risk investment. Generally speaking...
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...Basel I DEFINITION OF 'BASEL I' A set of international banking regulations put forth by the Basel Committee on Bank Supervision, which set out the minimum capital requirements of financial institutions with the goal of minimizing credit risk. Banks that operate internationally are required to maintain a minimum amount (8%) of capital based on a percent of risk-weighted assets. Basel II is the second of the Basel Accords, (now extended and partially superseded[clarification needed] by Basel III), which are recommendations on banking laws and regulations issued by the Basel Committee on Banking Supervision. BREAKING DOWN 'Basel I' The first accord was the Basel I. It was issued in 1988 and focused mainly on credit risk by creating a bank asset classification system. This classification system grouped a bank's assets into five risk categories: 0% - cash, central bank and government debt and any OECD government debt 0%, 10%, 20% or 50% - public sector debt 20% - development bank debt, OECD bank debt, OECD securities firm debt, non-OECD bank debt (under one year maturity) and non-OECD public sector debt, cash in collection 50% - residential mortgages 100% - private sector debt, non-OECD bank debt (maturity over a year), real estate, plant and equipment, capital instruments issued at other banks The bank must maintain capital (Tier 1 and Tier 2) equal to at least 8% of its risk-weighted assets. For example, if a bank has risk-weighted assets of $100 million, it is required to maintain...
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... In Canada recession was less severe and they face no banking failure due to the size and diversification in their large institution has maintained their stability. New Entrant was limited by Canadian government and I exchange chartered bank with provide them financial stability, in Canada focuses on banking sector that’s why brokers dealers and security market remain much at smaller .The banking system of branch was oliogiopolisty that imply the system which has limited supply of banking services and cost as compared to their competitors . In our previous work (Bordo et al., 1994) we analyzed that the Canadian banking is not categorized in higher cost as compared to US. The banking of Canada same returns on equity and largely used MMMFSs After 1987 they became a vital part of Canada banking, at that time government had given them permission to create MMMFs and half of total MMMFs are kept at bank which means that they are within the banking system. According to (Byung kyong & Niamh Sheridan,2012) Canada’s three large bank weighted average is two an half time smaller than Australia’s four major banks however non performing rate of housing loans in Australia and Canada are almost same in recent years. The mortgages in Canada are provided by Canada mortgage and Housing Corporation own by Government are assigned at weight of zero risk, therefore the lowest risk of residential mortgages of four large Canadian banking is almost 70% in comparison with 40% of major Australian...
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...These evaluations are later translated into the decision-making process. The analysis helps align strategies with the firm’s environment. Our market is facing changes every day. Many new things develop over time and the whole scenario can alter in only a few seconds. There are some factors that are beyond your control. But, you can control a lot of these things. Businesses are greatly influenced by their environment. All the situational factors which determine day to day circumstances impact firms. So, businesses must constantly analyze the trade environment and the market. Political factors or how and to what degree a government intervenes in the economy. Specifically, political factors include areas such as tax policy, labour law, environmental law, trade restrictions, tariffs, and political stability. Political factors may also include goods and services which the government wants to provide or be provided (merit goods) and those that the government does not want to be provided (demerit goods or merit bads). Furthermore, governments have great influence on the health, education, and infrastructure of a nation. Economic factors include economic growth, interest rates, exchange rates and the inflation rate. These factors have major impacts on how businesses operate and make decisions. Social factors include the cultural aspects and include health consciousness, population growth rate, age distribution, career attitudes and emphasis on safety. Trends in social factors...
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...Bangladesh, 160 million peoples country is encompasses with thousands of Industries where service sector have taken the leading position in the country’s GDP in recent years. Banking sector is holding the leading position in order to take the GDP’s leader board of the table among the service industries. Last year Banking sector have contributed 48% of the country’s total GDP which is the clear indicator of pick position holder of the table. That rapid growth of the Banking service industry influenced a lot of people to involve their career in multiple sector of banking industry directly. So this is the perfect beginning t report the modern banking service in Bangladesh by South East Bank Limited where I have witnesses their performance growth in banking sector as an intern. Banking plays an important role in the economy of any country. In Bangladesh Muslim consist more than 80% of its population. These people possess strong faith on Allah and they want to lead their lives as per the construction given in the holy Quran and the way shown by the prophet Hazrat Mohammad (sm).But on Islamic banking system was developed here up to 1983.The traditional banking is fully based on interest it is commonly meant as commercial banks. But interest is absolutely prohibited by Islam. The main aim of traditional banking is to earn profit by borrowing and lending money in exchange of interest. As a result there is an unfair competition among the bankers and among the customers. The major objective...
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...Glass-Steagall Act, also known as the |activities of investment banks and commercial |banking activities. | |Banking Act of was passed by Congress in 1933|banks. |Prohibited commercial banks sales of | |during a nationwide commercial bank failure |To get rid from the Great Depression of the |securities | |and the Great Depression. Two members of |economy. | Created the Federal Deposit Insurance | |Congress put their names on what is known |Commercial banks were accused of being too |Corporation (FDIC), which insures bank | |today as the Glass-Steagall Act (GSA). |speculative in the pre-Depression era, not |deposits with a pool of money appropriated | | |only because they were investing their assets |from banks. | | |but also because they were buying new issues | Public confidence was restored by the act in | | |for resale to the public. |banking practices of U.S. government during | | | |the Great Depression | |The Banking Act of 1935: |Permanent establishment of the FDIC as a ...
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...A. INTRODUCTION The term ‘customer’ of a bank is not defined by law. Ordinarily a person who has an account in a bank is considered its customer. There is no statutory definition of “customer”, and so one has to refer the decisions of the courts in order to discover the principle which determines whether or not a person is a customer. In the United States, customer means, ‘any person having an account with a banker or from whom a bank has agreed to collect items and includes a bank carrying an account with another bank’.The statutory protection under section 131 and 131A of the Negotiable Instruments Act, 1881, is available to a collecting banker only if the banker inter alia receives payment of a cheque or a draft for a customer. Though a customer is a very important person for a bank, he appears only once in law of Negotiable Instrument (i.e., in section 131 of the Negotiable Instruments Act) and even there only casually; he is neither defined nor explained. A customer of a banker need not necessarily be a person. A firm, joint stock Company, a society or any separate legal entity may be a customer. According to section 45-Z of the Banking Regulation Act, 1949, “Customer” includes a government department and a corporation incorporated by or under any law.2 Special types of customer means are those who are distinguished from other types of ordinary customers by some special features. Hence, they are called special types of customers. They are to be dealt with carefully while...
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... Abstract: Basel II Capital Accord and implementation implications in Albania 2 I. What is New Basel Capital Accord and its Evolution 4 II. Adoption of Basel II 5 BCBS Countries 5 In Other Countries 6 Banking Supervision Improvement Priorities 6 III. History of Banking Supervision in Albania (Banking System in Albania and Supervisory Process. 7 IV. Three Pillars of Basel II and the implications related to the implementation in Albania: 10 1.Pillar 1 – Capital Defined 11 1.1 Pillar 1 – Credit Risk 11 1.2 Pillar 1 – Market Risk 15 1.3 Pillar 1 – Operational Risk 16 2. Pillar 2 – The Supervisory Review Process 16 3. Pillar 3 – Market Disclosure 18 V. Reference List 21 Abstract: Basel II Capital Accord and implementation implications in Albania I. The first part is concentrated in what is new Basel Capital Accord and its Evolution. Supervisors have long sought to ensure that banks maintain adequate capital to cover all risks. In 1988, the Basel Committee on Banking Supervision agreed the 'International Convergence of Capital Measurement and Capital Standards', more commonly known as the Basel Capital Accord which in most countries is fully implemented in 1992. The evolution of banking worldwide led the Basel Committee to initiate revisions to the 1988 Accord. First proposed in 1999, and due to come into effect in many jurisdictions by the end of 2008 the revised Capital Accord – Basel II – is a comprehensive...
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...The Indian Internet Banking Journey We want to use the Internet to become a universal banking major." - Nachiket Mor, Head of ICICI's Treasury, in March 2000. The Internet Banking Boom In 2001, a Reserve Bank of India survey revealed that of 46 major banks operating in India, around 50% were either offering Internet banking services at various levels or planned to in the near future. According to a research report,1 while in 2001, India's Internet user base was an estimated 9 lakh; it was expected to reach 90 lakh by 2003. Also, while only 1% of these Internet users utilized the Internet banking services in 1998, the Internet banking user base increased to 16.7% by mid- 2000. Many of the major banks like ICICI, HDFC, IndusInd, IDBI, Citibank, Global Trust Bank (GTB), Bank of Punjab and UTI were offering Internet banking services. Based on the above statistics and the analysts' comments that India had a high growth potential for Internet banking, the players focused on increasing and improving their Internet banking services. As a part of this, the banks began to collaborate with various utility companies to enable the customers to perform various functions online. ICICI's 'Infinity,' which was already a leader in the Indian Internet banking arena, began to allow its customers to pay their online real time shopping bills. HDFC, through its 'payment gateway' feature, allowed its Internet banking customers to make online and real time payments for their purchases. | ...
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