Banking Operations – an Overview

1. Unit 5 Banking Operations – an Overview Facilitator Support Materials for Banking Operations - an Overview

2. Unit Aim This unit aims to introduce the learner to the main operations undertaken by a bank. Thus it covers deposits, lending and other services that retail banks provide to their customers. This unit is 20 Guided Learning Hours

3. Unit Description This is one of three units which covers banking operations and introduces the learner to the range of services that a bank can offer to its customers, particularly savings and investment accounts, lending facilities, payment services, share dealing, executor and trustee services, insurance and investment advice.

4. Unit Description Continued • The unit is relevant to anyone who wants to work for a retail bank, who already works for one or who wishes to understand the basics of what a retail bank does and wishes to increase their background knowledge as to the basics of what the bank does and how it does it. This unit is the first of three units in a series, which deal with all aspects of banking operations and money transmission.

5. Learning Outcome 1: Understand the importance of banks being able to attract depositors of funds Amplification of the Learning Outcome: Importance: lending; rates of interest; use of money markets Range of accounts offered by banks: current accounts; high interest current accounts; savings accounts; investment accounts; Individual Savings Accounts (ISA’s)

6. Assessment Criteria for Learning Outcome 1 Assessment Criteria: 1.1 Explain the reasons why banks need to attract depositors of funds Open discussion with Learners 1.2 Compare the different accounts which the banks offer to attract depositors of funds Open discussion with Learners

7. Learning Outcome 2: Know the lending products offered by banks Amplification of the Learning Outcome: Lending products: overdrafts; personal loans; hire purchase loans; equity release or capital release loans; budget accounts; revolving credit accounts; revolving budget accounts; features of products

8. Assessment Criteria for Learning Outcome 2 Assessment Criteria: 2.1 Describe the various lending products offered by banks Open discussion with Learners 2.2 Describe the distinguishing features of lending products offered by banks Open discussion with Learners

9. Learning Outcome 3: Know banks’ share dealing services, executor, trustee services, insurance and investment services Amplification of the Learning Outcome: Key Terms: contract note; executor; trustee; trust deed; execution only basis; tied agent Customer benefits: convenience; collection of funds, remit funds; impartiality; monitoring fluctuations; switching funds; knowledge of market

10. Assessment Criteria for Learning Outcome 3 Assessment Criteria: 3.1 Describe the banks’ share dealing services Open discussion with Learners 3.2 Describe the banks’ executor and trustee services Open discussion with Learners

11. Assessment Criteria for Learning Outcome 3 Continued • 3.3 Describe the banks’ insurance and investment services • Open discussion with Learners • 3.4 Summarise the advantages to the customer of having these services ‘in house’ • Open discussion with Learners

12. Appropriate Books Diploma in Financial Services, Banking Operations The Money Machine Retail Banking Book One Banking Operations

13. Appropriate websites www.bankofengland.co.uk/ www.bba.org.uk/bba/jsp/polopoly.jsp;jsessionid=az3XEMccpMo_?d=103 www.fsa.gov.uk/ www.hm-treasury.gov.uk/ www.projects.exeter.ac.uk/RDavies/arian/origins.html