The Business Environment Flashcards
1
Q
What are some of the characteristics The UK clearing banks share?
A
They are all large financial institution, offering a wide range of services within their respective banking groups.
- Their deposits have a fixed monetary value and so, unlike investments in socks and shares, they cannot lose their capital value
2
Q
What if a bank cannot pay back its depositors?
A
There is always the potential for this to happen, as the banks are commercial organisations that utilise their deposits to create loans and other assets. If enough depositors asked for the immediate withdrawal of all their funds, all at once, the banks would not be able to meet these demands. Finish this paragraph.
