Depository institutions
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Depository Institutions. Take Charge of Your Finances 1.7.3. Depository Institutions. Depository Institutions – businesses which offer multiple services in banking and finance These institutions include: Banks Savings and Loans Credit Unions

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Depository Institutions

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Depository institutions

Depository Institutions

Take Charge of Your Finances 1.7.3


Depository institutions1

Depository Institutions

  • Depository Institutions – businesses which offer multiple services in banking and finance

    • These institutions include:

      • Banks

      • Savings and Loans

      • Credit Unions

    • They are regulated by various state and federal agencies


Depository institutions2

Depository Institutions


Federal reserve bank

Federal Reserve Bank

  • Services include:


Federal reserve bank1

Federal Reserve Bank

  • Which federal reserve bank is located in your region?


Life of a deposited check

Life of a Deposited Check


Depository institutions3

Depository Institutions

  • Commercial Bank

  • Credit Union

  • Savings and Loan Association


Commercial bank

Commercial Bank

  • Commercial Banks

    • Usually the largest depository institutions

    • Considered full-service depository institutions

    • Available to a variety of consumers

  • Examples – Wells Fargo, US Bank, Chase Bank


Credit union

Credit Union

  • Credit Unions

    • Non-profit cooperative depository institution

  • Owned by members who share a common bond

  • Examples – Rocky Mountain Credit Union, Teachers Federal Credit Union


Savings and loan association s ls

Savings and Loan Association (S&Ls)

  • Savings and Loan Association

    • Focus on providing loans and mortgages

  • Customers must have a savings account with them

  • Examples – American Federal Savings Bank, Pioneer Federal Savings & Loan.


Types of insurance

Types of Insurance

  • Federal Deposit Insurance Corporation (FDIC)

    • Federal government agency which protects depository institution accounts

    • Insures commercial banks and savings and loan associations

  • National Credit Union Administration (NCUA)

    • Provides insurance for credit unions


Insurance protection

Insurance Protection

  • Insurance protection

    • Each depositor is insured up to $250,000 for money deposited in a regular account and $250,000 for retirement deposits

    • Available from both FDIC and NCUA

  • Insurance is important because of the risk of loss

  • Risk of Loss is used to determine which party should be responsible for damage or loss of products after a service transaction has been completed but prior to delivery


Interest

Interest

  • Interest - the amount of money that is either gained or lost when accessing services offered by a depository institution

  • Interest rate - the percentage used annually to calculate the total interest either gained or lost


Depository institution services

Depository Institution Services


Common services offered

Common Services Offered


Interest bearing accounts

Interest Bearing Accounts


Interest bearing accounts1

Interest Bearing Accounts

  • Credit Card

    • A card used to make a purchase now and repay later

      • If the balance is paid before the grace period ends, interest is not added

      • If the balance is paid after the grace period, the payment of interest is required

  • Loan

    • Money borrowed and paid back with interest

      • Mortgage – loan for a home

      • Personal – interest rates vary depending upon type of loan

        • Loan types can include vehicle, school, etc.


Additional services which may be offered

Additional Services Which May Be Offered

  • Safe-Deposit Box

    • A secured box in a bank to be used for valuable and important personal items.

  • Financial Counseling

    • Information and advice is given to customers to help make financial decisions.


Conclusion review

Conclusion& Review


Review

Review


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