CQIB Study Cards Questions With Correct Answers.

CQIB Study Cards Questions With Correct Answers. Which regulator makes and enforces rules which govern the capital adequacy of Australian Banks? - answerThe Australian Prudential Regulation Authority - APRA What events occurred in the Banking Industry in 1800s and early 1900s? - answerFirst Bank in Australia was Bank of NSW, Established in 1817 Sydney. Discovery of gold in 1851 led to minting of Australia's own gold coins spurring development of Banking. Boom in Australian property market in 1800s led to Banking crisis in 1893. What events occurred in in the Banking Industry? - answerAustralian pound was issues as the Legal tender in Australia and the Australian Notes act 1910 assigned responsibility for the issue of Bank notes to the Commonwealth Treasury. What events occurred in in the Banking Industry? - answerFederal government established the Commonwealth Bank, which by 1913 had branches in 6 states. What events occurred in 1920 in the Banking Industry? - answerCommonwealth performed some central Bank functions, which greatly expanded in World War II. What events occurred in in the Banking Industry? - answer1931 - The Great Depression, By the end Banking Industry became tightly regulated. Banks classified as either savings or trading Banks. What events occurred in in the Banking Industry? - answer14/01/1960 - Reserve Bank of Australia was created 1969 - Rolled out ATMs, and early 1970 BSB identifier was introduced. What events occurred in in the Banking Industry? - answerRenewed emphasis on corporate governance, values, ethics. Jan 17 - Better Banking program launched with initiatives: - Independent review of retail Banking remuneration and how we pay staff. - Getting problems fixed - Protecting whistle-blowers - Stopping poor conduct, and review of code of Banking practise What are other Finance service providers? Authorised Deposit-Taking Institutions (ADI's) - answerBuilding Societies: Credit Unions: What is a Building Society? - answerA mutual institution, which means that most people who have a savings account, or mortgage are members. Each building society and are responsible for setting its strategy. - Owner by and for the members - Limit on proportion of their funds that building societies can raise from wholesale money market - Reinvest surplus revenue into the business to provide new products and services. What is a credit union? - answera non-profit-making money cooperative whose members can borrow from pooled deposits at low interest rates. What are non-ADI's financial intermediaries? - answer- Money Markets Corporations - Finance Companies - Securitisation Vehicles What are the 4 types of financial markets - answer1. Primary Markets 2. Secondary Market 3. Exchange Traded Markets 4. Over the counter markets What is the Interest rate or Debt market. - answerTrading (Buying and Selling) includes shart term securities and long term securities such as government and corporate bonds. What is the Foreign Exchange Market? - answerExchanging one currency for another. Largest financial market in the World and 24 hours a day. Trading shared in listed companies - answerWhat is the equities market? What is the Commodities Market? - answerTrading in raw or primary products such as wheat, grain, cattle., or electricity. What is the Derivatives Market? - answerA contract whose value is derived from one or more underlining assets or instruments; for example, forward rate agreements or underlying exchange rates. What is microeconomics? - answerthe study of how households and firms make decisions and how they interact in markets. Supply and demand that impact the price levels in the economy. Taxes and Regulation created by governments. What is macroeconomics? - answerThe study of the economy as a whole - Unemployment rates - Gross Domestic Product - GDP - Inflation - Export and Imports What are the Australian Economy Facts and Figures - answer14th Largest economy measured by GDP 1.99 Trillon - 2019 - Australian Labour force 12.3 millions June 2020 - Low levels of inflation 2% July 2020 - Unemployment rate 7% What is Fiscal Policy? - answerGovernment spending and taxation that influences the economy. What is the Monetary Policy - answerRBA is responsible for Australians monetary policy - aims to protect price stability full employment and economic prosperity. What events occurred in 1980's in the Banking Industry? - answerGovernment adopted the four pillars policy. Announced it would reject any mergers between the Big 4 Banks. - NAB - CBA - Westpac - ANZ What is the role of the Bank? - answer1. Act as a financial intermediary between savers & borrowers. 2. Contributes to the development of the economy What is financial intermediation? - answerThe process of pooling funds from savers and using these funds to provide loans to borrowers. The Bank acts as a go between, or intermediary for those who have extra money and those who want to borrow. What are the 4 types of investment Banking? - answer1. Debt Capital Markets 2. Equity Capital Markets 3. Private Placements 4. Mergers and Acquisitions What is Debt Capital Markets? - answerWhere a large company may want to build a factory and is looking to issue bond financing to finance its expansion, or if a government wants to finance the building of an airport, highway, or other large municipal project, it may issue bonds to raise capital. What is Equity Capital Markets? - answerWhere a company needs more money to grow and decides to raise the funds by undertaking an initial public offering (IPO) whereby it sells its shares to the public and a wi