Chapter 2: Deposit-Taking Institutions Flashcards
The simplified balance sheet for a DTI has ___ and other assets under Assets
loans
The simplified balance sheet for a DTI has ___ , equity and other liabilities under L & E
deposits
DTIs accept ____, give out ____
deposits; loans
The primary revenue model of DTIs are to pay higher/lower interests on liabilities, charge higher/lower interests on assets
lower; higher
Revenue sources for DTIs include ____ ____ and ___
interest spread;
fees (e.g., payment
services, fund remittances, etc.)
Interest spread has decreased and fees have increased over the years due to which two factors?
- competition
2. “traditional” banking activities decreased
What type of DTI is federally regulated, chartered under Bank Act of Canada, require charter of Ministry of Finance to operate
Chartered Banks
Is a bank that is a domestic (Canadian) parent, widely-held (no single shareholder can own over 20% of voting shares) a Schedule I, II, or III bank?
Schedule I
Is a bank that is a Canadian bank subsidiary of a foreign parent bank, often closely held a Schedule I, II, or III bank?
Schedule II
Is a bank that is a less regulated foreign bank branch authorized to restricted Canadian business (accept only large deposits > $150,000) a Schedule I, II, or III bank?
Schedule III
What DTI is: member-owned, members are depositors as well as shareholders
(deposit funds, obtain shares), self-regulated + partially provincially regulated?
Credit Union
Banks in Canada on average have a low amount of liquid cash. (T/F)
True
Banks in Canada on average have a low amount of inter-FI borrowings (‘repos’) (T/F)
False
Banks in Canada on average have high leverage amounting to almost 400 billion $ (T/F)
True
