CQIB - Chapter 1 - BUSINESS OF BANKING
questions with verified answers
Accepting Deposits: Banks source their funds largely from deposits from
the public? What are the 3 main types of public deposits Ans✓✓✓
Savings deposits (from salary and wage earners)
Fixed term deposits (lump sum deposited for a
specific period)
Current deposits (business accounts)
BANK HISTORY: 1800s and early 1900s Ans✓✓✓ The, first bank in
Australia was the Bank of NSW, establisl1ed in 1817 in Sydney.
The discovery of gold in 1851 led to the minting of Australia's own gold
coins and spurred the development of banking.
A speculative boom in the Australian property market in the 1800s led
to the Australian banking crisis of 1893. This was in an environment
where little government control or regulation of banks had been
established and led to the failure of 11 commercial banks.
BANK HISTORY: 1910 -1920 Ans✓✓✓ The Australian Pound was issued
as the legal tender in Australia and the Australian Notes act of 1910
assigned responsibility for the issue of bank notes to the
Commonwealth Treasury.
,BANK HISTORY: 1911 -1913 Ans✓✓✓ In 1911 the federal government
established the Commonwealth Bank, which by 1913 had branches in
all six states
BANK HISTORY: 1920 Ans✓✓✓ The Commonwealth Bank performed
some central bank functions, which were greatly expanded during
World War II.
BANK HISTORY: 1930 -1931 Ans✓✓✓ The Great Depression of the
1930s brought a string of bank failures. In 1931, the Commonwealth
bank took over two faltering state savings banks. By the end of the
Depression era, banking in Australia had become tightly regulated.
It was virtually impossible for a foreign bank to establish branches and
consequently Australia had fewer banks than other countries.
BANK HISTORY: 1960 -1970 Ans✓✓✓ The Reserve Bank of Australia
was created on 14 January 1960 and assumed the central bank
functions previously performed by the Commonwealth Bank.
In the mid 1960's the distinction between and separation of savings and
trading banks was removed, and all banks were allowed to operate in
the money market. Banks were allowed to set their own interest rate
and building societies could take deposits from the public.
, In 1969 the rollout of the automated teller machines (ATMs)
commenced as banks sought to reduce operating costs. The use of the
Bank State Branch (BSB) identifier was introduced in the early 1970's.
BANK HISTORY: 1980s Ans✓✓✓ In late 1981, The Campbell Committee
of enquiry into the Australian Financial System was published and
recommendation to move away from regulating range of financial
activities.
Banks and other financial institutions had much greater freedom to
respond to competitive market signals and customer requirements.
BANK HISTORY: 1990 - 2000 Ans✓✓✓ The Government adopted a
"four pillars policy" in relation to banking in Australia and announced
that it would re1ect any mergers between the four big banks (ANZ,
CBA. NAB and Westpac). The intent was to avoid further concentration
of major bank suppliers in the Australian market.
BANK HISTORY: 2000 - 2017 Ans✓✓✓ Since the events of 2008 and
2009, attention has been focused on the ways in which banks conduct
themselves, with renewed emphasis on corporate governance, values
and ethics. In January 2017 The Better Banking Program was launched
with initiatives such as:
Independent review of retail banking remuneration and overarching
principles on how banks pay staff. Getting problems fixed.
questions with verified answers
Accepting Deposits: Banks source their funds largely from deposits from
the public? What are the 3 main types of public deposits Ans✓✓✓
Savings deposits (from salary and wage earners)
Fixed term deposits (lump sum deposited for a
specific period)
Current deposits (business accounts)
BANK HISTORY: 1800s and early 1900s Ans✓✓✓ The, first bank in
Australia was the Bank of NSW, establisl1ed in 1817 in Sydney.
The discovery of gold in 1851 led to the minting of Australia's own gold
coins and spurred the development of banking.
A speculative boom in the Australian property market in the 1800s led
to the Australian banking crisis of 1893. This was in an environment
where little government control or regulation of banks had been
established and led to the failure of 11 commercial banks.
BANK HISTORY: 1910 -1920 Ans✓✓✓ The Australian Pound was issued
as the legal tender in Australia and the Australian Notes act of 1910
assigned responsibility for the issue of bank notes to the
Commonwealth Treasury.
,BANK HISTORY: 1911 -1913 Ans✓✓✓ In 1911 the federal government
established the Commonwealth Bank, which by 1913 had branches in
all six states
BANK HISTORY: 1920 Ans✓✓✓ The Commonwealth Bank performed
some central bank functions, which were greatly expanded during
World War II.
BANK HISTORY: 1930 -1931 Ans✓✓✓ The Great Depression of the
1930s brought a string of bank failures. In 1931, the Commonwealth
bank took over two faltering state savings banks. By the end of the
Depression era, banking in Australia had become tightly regulated.
It was virtually impossible for a foreign bank to establish branches and
consequently Australia had fewer banks than other countries.
BANK HISTORY: 1960 -1970 Ans✓✓✓ The Reserve Bank of Australia
was created on 14 January 1960 and assumed the central bank
functions previously performed by the Commonwealth Bank.
In the mid 1960's the distinction between and separation of savings and
trading banks was removed, and all banks were allowed to operate in
the money market. Banks were allowed to set their own interest rate
and building societies could take deposits from the public.
, In 1969 the rollout of the automated teller machines (ATMs)
commenced as banks sought to reduce operating costs. The use of the
Bank State Branch (BSB) identifier was introduced in the early 1970's.
BANK HISTORY: 1980s Ans✓✓✓ In late 1981, The Campbell Committee
of enquiry into the Australian Financial System was published and
recommendation to move away from regulating range of financial
activities.
Banks and other financial institutions had much greater freedom to
respond to competitive market signals and customer requirements.
BANK HISTORY: 1990 - 2000 Ans✓✓✓ The Government adopted a
"four pillars policy" in relation to banking in Australia and announced
that it would re1ect any mergers between the four big banks (ANZ,
CBA. NAB and Westpac). The intent was to avoid further concentration
of major bank suppliers in the Australian market.
BANK HISTORY: 2000 - 2017 Ans✓✓✓ Since the events of 2008 and
2009, attention has been focused on the ways in which banks conduct
themselves, with renewed emphasis on corporate governance, values
and ethics. In January 2017 The Better Banking Program was launched
with initiatives such as:
Independent review of retail banking remuneration and overarching
principles on how banks pay staff. Getting problems fixed.
