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51-459: The BUB had its head office from the start on the prestigious Na příkopě thoroughfare in central Prague, Nos.958-959, in a neoclassical building erected in the 1830s. In 1929, it demolished a building in the same block (No.574) to erect a more modern facility, but that project never came to fruition. The Böhmische Union-Bank was established by conversion of the former Prague branch of Vienna -based Union-Bank , itself formed recently by merger, into

102-470: A traffic policeman . In 1927, then the second intersection with the light signaling (the first being Hybernská-Dlážděná-Havlíčkova intersection). In the 1960s, traffic jams were getting worse. However, in 1978 the metro station was opened at Můstek , and Line B followed the street since 1985 for almost its entire length to the Republic Square . Nearly century-old tram line was canceled in 1985 and

153-412: A bank account is considered indispensable by most businesses and individuals. Non-banks that provide payment services such as remittance companies are normally not considered as an adequate substitute for a bank account. Banks issue new money when they make loans. In contemporary banking systems, regulators set a minimum level of reserve funds that banks must hold against the deposit liabilities created by

204-507: A full absorption of BUB in 1942, but this plan was not executed. By 1943, Deutsche Bank owned 91 percent of BUB's equity capital, of which 33 percent indirectly through Creditanstalt-Bankverein. After the end of the war, the Czechoslovak authorities decided in August 1945 to liquidate BUB given its German associations. The management was taken over by a national administrator, and the confiscation

255-617: A high concentration of German-speaking population; of these, only one was in Slovakia (in Bratislava ). 23 of these were lost following the Munich Agreement in 1938, and taken over by Deutsche Bank . In March 1939, after the establishment of the Protectorate of Bohemia and Moravia , Deutsche Bank executive Walter Pohle  [ de ] led the aryanization process under oversight by

306-425: A large number of small to medium-sized institutions in its banking system. As of November 2009, China's top four banks have in excess of 67,000 branches ( ICBC :18000+, BOC :12000+, CCB :13000+, ABC :24000+) with an additional 140 smaller banks with an undetermined number of branches. Japan had 129 banks and 12,000 branches. In 2004, Germany, France, and Italy each had more than 30,000 branches – more than double

357-416: A safe and convenient form of money backed by the goldsmith's promise to pay, allowing goldsmiths to advance loans with little risk of default . Thus the goldsmiths of London became the forerunners of banking by creating new money based on credit. The Bank of England originated the permanent issue of banknotes in 1695. The Royal Bank of Scotland established the first overdraft facility in 1728. By

408-517: A stand-alone institution on 20 February 1872. The initial capital was 10 million Austro-Hungarian guldens . The BUB was soon involved into the short-lived Crédit foncier für das Königreich Böhmen , but that venture was wound up in 1874 following the panic of 1873 . Also in 1874, BUB acquired two other Prague-based banks founded in 1872, the Böhmischer Sparverein and Böhmische Handels-, Gewerbe- und Realitätenbank . In 1888, it took over

459-399: A variety of different ways including interest, transaction fees and financial advice. Traditionally, the most significant method is via charging interest on the capital it lends out to customers. The bank profits from the difference between the level of interest it pays for deposits and other sources of funds, and the level of interest it charges in its lending activities. This difference

510-446: Is a bank regulation , which sets a framework within which a bank or depository institution must manage its balance sheet . The categorisation of assets and capital is highly standardised so that it can be risk weighted . After the financial crisis of 2007–2008 , regulators force banks to issue Contingent convertible bonds (CoCos). These are hybrid capital securities that absorb losses in accordance with their contractual terms when

561-400: Is a Bills of Exchange Act that codifies the law in relation to negotiable instruments , including cheques, and this Act contains a statutory definition of the term banker : banker includes a body of persons, whether incorporated or not, who carry on the business of banking' (Section 2, Interpretation). Although this definition seems circular, it is actually functional, because it ensures that

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612-403: Is a list of the largest deals in history in terms of value with participation from at least one bank: Currently, commercial banks are regulated in most jurisdictions by government entities and require a special bank license to operate. Usually, the definition of the business of banking for the purposes of regulation is extended to include acceptance of deposits, even if they are not repayable to

663-691: Is a street in the center of Prague , Czech Republic , connecting Wenceslas Square with the Republic Square . It separates the Old Town from the New Town . It is a place of representative buildings including the headquarters of the Czech National Bank , old palaces and luxurious shops. Na příkopě is the most expensive street among the all states of the V4 . In 2019, with the amount of rent 2,820 euros (72,478 CZK) per square meter per year, ranked on 18th place among

714-431: Is referred to as the spread between the cost of funds and the loan interest rate. Historically, profitability from lending activities has been cyclical and dependent on the needs and strengths of loan customers and the stage of the economic cycle . Fees and financial advice constitute a more stable revenue stream and banks have therefore placed more emphasis on these revenue lines to smooth their financial performance. In

765-605: The Basel Accords . Banking in its modern sense evolved in the fourteenth century in the prosperous cities of Renaissance Italy but, in many ways, functioned as a continuation of ideas and concepts of credit and lending that had their roots in the ancient world . In the history of banking , a number of banking dynasties  – notably, the Medicis , the Pazzi , the Fuggers ,

816-705: The Federal Deposit Insurance Corporation (FDIC) as a regulator. However, for soundness examinations (i.e., whether a bank is operating in a sound manner), the Federal Reserve is the primary federal regulator for Fed-member state banks; the Office of the Comptroller of the Currency (OCC) is the primary federal regulator for national banks. State non-member banks are examined by the state agencies as well as

867-575: The Gestapo . The Jewish members of the supervisory board were dismissed, and the other members of the board all resigned. Deutsche Bank took majority control of BUB, simultaneously as Böhmische Escompte-Bank went to Dresdner Bank , while Deutsche's de facto subsidiary Creditanstalt-Bankverein took over the BUB's Bratislava branch. BUB also established an aryanization office to foster expropriation and dismissal of Jews in its client companies. Deutsche Bank planned

918-631: The Great Depression , the U.S. Savings and Loan crisis in the 1980s and early 1990s, the Japanese banking crisis during the 1990s, and the sub-prime mortgage crisis in the 2000s. The 2023 global banking crisis is the latest of these crises: In March 2023, liquidity shortages and bank insolvencies led to three bank failures in the United States , and within two weeks, several of the world's largest banks failed or were shut down by regulators Assets of

969-522: The Medici Bank , in 1397. The Republic of Genoa founded the earliest-known state deposit bank, and Banco di San Giorgio (Bank of St. George), in 1407 at Genoa , Italy. Fractional reserve banking and the issue of banknotes emerged in the 17th and 18th centuries. Merchants started to store their gold with the goldsmiths of London , who possessed private vaults , and who charged a fee for that service. In exchange for each deposit of precious metal,

1020-563: The Renaissance by Florentine bankers, who used to make their transactions atop desks covered by green tablecloths. The definition of a bank varies from country to country. See the relevant country pages for more information. Under English common law , a banker is defined as a person who carries on the business of banking by conducting current accounts for their customers, paying cheques drawn on them and also collecting cheques for their customers. In most common law jurisdictions there

1071-577: The Welsers , the Berenbergs , and the Rothschilds  – have played a central role over many centuries. The oldest existing retail bank is Banca Monte dei Paschi di Siena (founded in 1472), while the oldest existing merchant bank is Berenberg Bank (founded in 1590). Banking as an archaic activity (or quasi-banking ) is thought to have begun as early as the end of the 4th millennium BCE, to

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1122-474: The 15,000 branches in the United Kingdom. Between 1985 and 2018 banks engaged in around 28,798 mergers or acquisitions, either as the acquirer or the target company. The overall known value of these deals cumulates to around 5,169 bil. USD. In terms of value, there have been two major waves (1999 and 2007) which both peaked at around 460 bil. USD followed by a steep decline (−82% from 2007 until 2018). Here

1173-404: The 19th century, we find in ordinary cases of deposits, of money with banking corporations, or bankers, the transaction amounts to a mere loan, or mutuum , and the bank is to restore, not the same money, but an equivalent sum, whenever it is demanded and money, when paid into a bank, ceases altogether to be the money of the principal (see Parker v. Marchant, 1 Phillips 360); it is then the money of

1224-419: The 3rd millennia BCE. The present era of banking can be traced to medieval and early Renaissance Italy, to the rich cities in the centre and north like Florence , Lucca , Siena , Venice and Genoa . The Bardi and Peruzzi families dominated banking in 14th-century Florence, establishing branches in many other parts of Europe. Giovanni di Bicci de' Medici set up one of the most famous Italian banks,

1275-522: The FDIC. National banks have one primary regulator – the OCC. Each regulatory agency has its own set of rules and regulations to which banks and thrifts must adhere. The Federal Financial Institutions Examination Council (FFIEC) was established in 1979 as a formal inter-agency body empowered to prescribe uniform principles, standards, and report forms for the federal examination of financial institutions. Although

1326-567: The UK, for example, the Financial Services Authority licenses banks, and some commercial banks (such as the Bank of Scotland ) issue their own banknotes in addition to those issued by the Bank of England , the UK government's central bank. Banking law is based on a contractual analysis of the relationship between the bank (defined above) and the customer  – defined as any entity for which

1377-639: The bank agrees to conduct an account. The law implies rights and obligations into this relationship as follows: These implied contractual terms may be modified by express agreement between the customer and the bank. The statutes and regulations in force within a particular jurisdiction may also modify the above terms or create new rights, obligations, or limitations relevant to the bank-customer relationship. Some types of financial institutions, such as building societies and credit unions , may be partly or wholly exempt from bank license requirements, and therefore regulated under separate rules. The requirements for

1428-571: The bank or indirectly through capital markets . Whereas banks play an important role in financial stability and the economy of a country, most jurisdictions exercise a high degree of regulation over banks. Most countries have institutionalized a system known as fractional-reserve banking , under which banks hold liquid assets equal to only a portion of their current liabilities. In addition to other regulations intended to ensure liquidity , banks are generally subject to minimum capital requirements based on an international set of capital standards,

1479-411: The bank will not repay it), and interest rate risk (the possibility that the bank will become unprofitable, if rising interest rates force it to pay relatively more on its deposits than it receives on its loans). Banking crises have developed many times throughout history when one or more risks have emerged for the banking sector as a whole. Prominent examples include the bank run that occurred during

1530-667: The bank, and collecting cheques deposited to customers' current accounts. Banks also enable customer payments via other payment methods such as Automated Clearing House (ACH), Wire transfers or telegraphic transfer , EFTPOS , and automated teller machines (ATMs). Banks borrow money by accepting funds deposited on current accounts, by accepting term deposits , and by issuing debt securities such as banknotes and bonds . Banks lend money by making advances to customers on current accounts, by making installment loans , and by investing in marketable debt securities and other forms of money lending. Banks provide different payment services, and

1581-456: The banker, who is bound to return an equivalent, by paying a similar sum to that deposited with him, when he is asked for it. The goldsmith paid interest on deposits. Since the promissory notes were payable on demand, and the advances (loans) to the goldsmith's customers were repayable over a longer time-period, this was an early form of fractional reserve banking . The promissory notes developed into an assignable instrument which could circulate as

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1632-704: The beginning of the 19th century Lubbock's Bank had established a bankers' clearing house in London to allow multiple banks to clear transactions. The Rothschilds pioneered international finance on a large scale, financing the purchase of shares in the Suez canal for the British government in 1875. The word bank was taken into Middle English from Middle French banque , from Old Italian banco , meaning "table", from Old High German banc, bank "bench, counter". Benches were used as makeshift desks or exchange counters during

1683-515: The business of banking for the purposes of the legislation, and not necessarily in general. In particular, most of the definitions are from legislation that has the purpose of regulating and supervising banks rather than regulating the actual business of banking. However, in many cases, the statutory definition closely mirrors the common law one. Examples of statutory definitions: Since the advent of EFTPOS (Electronic Funds Transfer at Point Of Sale), direct credit, direct debit and internet banking ,

1734-488: The bustling urban street turned into a pedestrian zone . On the street appeared many new stores and it became an important business center of Prague promenade. 50°5′8″N 14°25′32.5″E  /  50.08556°N 14.425694°E  / 50.08556; 14.425694 Bank A bank is a financial institution that accepts deposits from the public and creates a demand deposit while simultaneously making loans . Lending activities can be directly performed by

1785-533: The capital of the issuing bank falls below a certain level. Then debt is reduced and bank capitalisation gets a boost. Owing to their capacity to absorb losses, CoCos have the potential to satisfy regulatory capital requirement. The economic functions of banks include: Banks are susceptible to many forms of risk which have triggered occasional systemic crises. These include liquidity risk (where many depositors may request withdrawals in excess of available funds), credit risk (the chance that those who owe money to

1836-483: The cheque has lost its primacy in most banking systems as a payment instrument. This has led legal theorists to suggest that the cheque based definition should be broadened to include financial institutions that conduct current accounts for customers and enable customers to pay and be paid by third parties, even if they do not pay and collect cheques . Banks act as payment agents by conducting checking or current accounts for customers, paying cheques drawn by customers in

1887-573: The collapse of Austria-Hungary, BUB had to give up its branches outside the newly formed territory of Czechoslovakia. Still, it was one of the largest financial institutions in the country, and the largest associated with the German community. In 1920, Banca Commerciale Italiana acquired a stake in BUB. That same year, BUB opened a new branch in Ostrava in the Kraus villa  [ cs ] , and in 1928 it acquired

1938-423: The cross-selling of complementary products. Banks face a number of risks in order to conduct their business, and how well these risks are managed and understood is a key driver behind profitability, and how much capital a bank is required to hold. Bank capital consists principally of equity , retained earnings and subordinated debt . Some of the main risks faced by banks include: The capital requirement

1989-408: The customer's order – although money lending, by itself, is generally not included in the definition. Unlike most other regulated industries, the regulator is typically also a participant in the market, being either publicly or privately governed central bank . Central banks also typically have a monopoly on the business of issuing banknotes . However, in some countries, this is not the case. In

2040-589: The funding of these loans, in order to ensure that the banks can meet demands for payment of such deposits. These reserves can be acquired through the acceptance of new deposits, sale of other assets, or borrowing from other banks including the central bank. Activities undertaken by banks include personal banking , corporate banking , investment banking , private banking , transaction banking , insurance , consumer finance , trade finance and other related. Banks offer many different channels to access their banking and other services: A bank can generate revenue in

2091-407: The goldsmiths issued receipts certifying the quantity and purity of the metal they held as a bailee ; these receipts could not be assigned, only the original depositor could collect the stored goods. Gradually the goldsmiths began to lend money out on behalf of the depositor , and promissory notes , which evolved into banknotes, were issued for money deposited as a loan to the goldsmith. Thus, by

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2142-442: The issue of a bank license vary between jurisdictions but typically include: Banks' activities can be divided into: Most banks are profit-making, private enterprises. However, some are owned by the government, or are non-profit organisations . The United States banking industry is one of the most heavily regulated and guarded in the world, with multiple specialised and focused regulators. All banks with FDIC-insured deposits have

2193-409: The largest 1,000 banks in the world grew by 6.8% in the 2008–2009 financial year to a record US$ 96.4 trillion while profits declined by 85% to US$ 115 billion. Growth in assets in adverse market conditions was largely a result of recapitalisation. EU banks held the largest share of the total, 56% in 2008–2009, down from 61% in the previous year. Asian banks' share increased from 12% to 14% during

2244-450: The legal basis for bank transactions such as cheques does not depend on how the bank is structured or regulated. The business of banking is in many common law countries not defined by statute but by common law, the definition above. In other English common law jurisdictions there are statutory definitions of the business of banking or banking business . When looking at these definitions it is important to keep in mind that they are defining

2295-500: The most expensive shopping streets in the world. Na Příkopě street leads on the site of former 10-meter-wide and 8-meter-deep moat from 1234, which led along the medieval walls of the Old Town . Water flowed directly from the Vltava river and when the moat was filled, the Old Town formed a closed island . The moat was covered in 1760. After covering, chestnut trees were planted here and

2346-760: The operations of liquidated Reichenberger Bank in present-day Liberec . By 1914, the BUB had 23 branches and branch offices in Cisleithania : 15 in the Czech lands with a concentration in the Sudetenland (present-day Bielsko , Brno , Broumov , Dvůr Králové nad Labem , Frýdek Jablonec nad Nisou , Krnov , Liberec , Nový Jičín , Olomouc , Opava , Rumburk , Šumperk , Vrchlabí , and Žatec ), and 8 further south in Celje , Dornbirn , Graz , Klagenfurt , Leoben , Linz , Salzburg , and Villach . Following World War I and

2397-455: The past 20 years, American banks have taken many measures to ensure that they remain profitable while responding to increasingly changing market conditions. This helps in making a profit and facilitates economic development as a whole. Recently, as banks have been faced with pressure from fintechs, new and additional business models have been suggested such as freemium, monetisation of data, white-labeling of banking and payment applications, or

2448-655: The small Varnsdorf Bank in Varnsdorf . Like other Czechoslovak banks, it was severely affected by the European banking crisis of 1931 . It subsequently absorbed the Allgemeiner Böhmischer Bank-Verein which had been formed in 1921 from the former operations of Wiener Bankverein on Czechoslovak territory. In 1937, BUB had 34 branches, mainly in the German-speaking border areas and large industrial cities with

2499-498: The street was named Ve starých alejích ( In old alleys ). In 1845-70 the street was named Kolowratská třída and since 1871 bears the name Na Příkopě . Because it was one of the few very wide streets in Prague, it soon became a traffic artery . Since 1875, the first line of the Prague horse-drawn tram has been lead here, which has been electrified since 1899. In 1919, Můstek became the first intersection in Prague to be controlled by

2550-459: The year, while the share of US banks increased from 11% to 13%. Fee revenue generated by global investment in banking totalled US$ 66.3 billion in 2009, up 12% on the previous year. The United States has the most banks in the world in terms of institutions (5,330 as of 2015) and possibly branches (81,607 as of 2015). This is an indicator of the geography and regulatory structure of the US, resulting in

2601-445: Was formalized by Presidential Decree No.108/1945 of 24 October 1945. BUB remained legally in existence (under the name Česká Banka Union) as a national enterprise in liquidation until at least 1969. This bank and insurance -related article is a stub . You can help Misplaced Pages by expanding it . Na p%C5%99%C3%ADkop%C4%9B Na příkopě (literally "On the moat"), informally also Na Příkopě , Na Příkopech or Příkopy ,

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