Therefore, a person or a firm is in charge a great exchange risk for a huge amounts of net claim and net liabilities. Exchange risk is better to be avoided or reduced. The exchange market provides facilities for hedging anticipated, actual claims or liabilities through forward contract in exchange. A forward contract will normally be about three months contract to buy or sell foreign exchange against another currency in a price agreed at some fixed date in the future. During the time of the contract, money is not allowed to flow.
The degree of its internationalization is significantly high. Taking the advantage of internationalisation on Chinese currency, the bank carries out the stragtes to explore and expand its cross border businesses in order to be “Going Global”( BOC Annual Report,2013, p40). With the completing corporate finance service and centralised credit systems as well as customer manager mechanism globally, bank of China sponsored 49 export credit projects and 98 overseas merger and acquisition as well as 597 overseas ongoing operation loans( BOC Annual Report, 2013,p40). The domestic RMB-denominated corporate loans is RMB3,688.976 billion with an increase of 6.86% of 2012 and foreign currency denominated corporate loans is USD82.530 billion with an increase of 6.19% than last year ( BOC Annual Report, 2013,p40) . By implementing this “Going Global” strategy, Bank of China has successfully taken a leading position for international business among the peers in the banking industry.
The currency market, aka foreign exchange (FX) market is the world’s largest spot market of any kind. On any given day more than a trillion units of currency are bought and sold with the prices of each note changing almost continuously. Currency is also a popular underlier for all sorts of derivatives, both OTC and ETD. Money: this is bought and sold when it is borrowed or lent in the form of loads or bonds, when a government or corporation issues a bond, it is simply borrowing money. The price of money to an issuer is, of course, interest, which it pays to the bond holders (lenders).
From the above, we have understand that non interest income is one of the type of bank income that charge by the bank through the penalty to customers or charge by giving the some services to their customers. One of the most common type of the non interest income for the bank is the service fees income. What is a service fees? A service fee is the fee that have been charged by the bank through the bank help their customer to manage their bank account. When the customers make the transactions to deposit or make payment by their account, the bank will help them to debit or credit their account.
1. The first issue that faced by CIMB Bank in the global market is a decline in the value of a country’s currency that influences on business. This currency crisis affects the country’s economy because of the contraction in Gross Domestic Product (GDP) growth. When the GDP’s country fall, the country’s output also is falling. The people will suffer the effect of currency crisis such as they have low wages and unsafe working conditions because business wants to lower costs.
The term “Bank” has been defined in different ways. According to Walter Leaf, “A bank is a person or corporation which holds itself out to receive from the public, deposits payable on demand by cheque.” Besides that, under the Banking and Financial Institutions Act (BAFIA) 1989, a “bank” is defined as “a person which carries on banking business”. Commercial banks are a financial institution based on trade funds, craft their basic as they act as a medium between investment and capital. The main player in the banking system and it is the largest and most crucial provider of funds in the banking system is commercial banks. According to Muhamad Muda (1996), the history of Malaysian banking development dates back to more than 130 years ago when the first commercial bank which is the Chartered Mercantile Bank of India, London and China was established in 1859.
In Bangladesh, BRAC Bank is an exclusive profit-making bank pointed on little and moderate Enterprises. On 4th July 2001, BRAC Bank was established to extend the huge amount of unbanked individuals who were not protected by traditional bank. Now at present, 400+ ATM networks are personalized by BRAC Bank. To the enlargement of Bangladesh, BRAC Bank’s aim is to approach with mass financing to allow mass production and mass consumption. Throughout the country, BRAC Bank schemes to set benchmark as the market leader in Bangladesh by creating economic, friendly and fully automatic online service on a successful support pointing to come up with trade funding work to the customers’ door.
Higher proportion (around 75%) is put in money markets, in the absence of arbitrage opportunities. v) Gilt funds LT- They invest 100% of their portfolio in long-term government securities vi) Income funds LT- Typically, such funds invest a major portion of the portfolio in long-term debt papers. vii) MIPs- Monthly Income Plans have an exposure of 70%-90% to debt and an exposure of 10%-30% to equities. viii) FMPs- Fixed monthly plans invest in debt papers whose maturity is in line with that of the fund. INVESTMENT STRATEGIES 1.
Money markets mostly consist of banks which lend and borrow from and lend to each other. However, other types financial institutions may also take part in the money markets. The common instruments used in the money markets include commercial paper, certificate of deposits, repurchase agreements, bankers’ acceptance, and so forth. On the other hand, stocks and bonds are the major instruments used in borrowing and
Financial instruments can be broadly classified into money market instruments and capital market instruments. 1. Money Market Instruments: The money market can be defi ned as a market for short-term money and financial assets that are near substitutes for money. The term ‘short-term’ means generally a period up to 1 year and near substitutes to money is used to denote any financial asset which can be quickly converted into money with minimum transaction cost. The sophistication and versatility of the money market is reflected in the diversity of money market instruments to suit the varied needs of market participants.