What’s this? A place where they lend you an umbrella in fair weather and ask for it back when it begins to rain. Mark Twain

Can you guess now? A place where they lend you an umbrella in fair weather and ask for it back when it begins to rain. Mark Twain A place that will “help” you if you can prove that you don't need “help”. Bob Hope

A bank is a place where they lend you an umbrella in fair weather and ask for it back when it begins to rain. Mark Twain A bank is a place that will lend you money if you can prove that you don't need it. Bob Hope If you owe the bank $100 that's your problem. If you owe the bank $100 million, that's the bank's problem. John Paul Getty Do you agree?

BANKING MK, U 14 RB, pp.56-60

MK, p 73: Lead-in Which of the following banking products or services do you find the most useful or necessary?

Match definitions with terms in MK, p 73 & discuss 1 one that pays interest, but usually cannot be used for paying cheques (GB) or checks (US), and on which notice is often required to withdraw money 2 a plastic card which is used instead of money to pay for goods and services. The cost is taken directly from the users bank account. 3 a computerized machine that allows bank customers to withdraw money, check their balance and so on 4 a fixed sum of money on which interest is paid, lent for a fixed period, and usually for a specific purpose 5 one that generally pays little or no interest, but allows the holder to withdraw his or her cash without any restrictions 6 a card which guarantees payment for goods and services purchased by the carholder, who pays back the bank or finance company at a later date 7 an instruction to a bank to pay fixed sums of money to certain people or organizations at state times

1 one that pays interest, but cannot be used for paying cheques (GB) or checks (US), and on which notice is often required to withdraw money – 2 a plastic card which is used instead of money to pay for goods and services. The cost is taken directly from the users bank account. – 3 a computerized machine that allows bank customers to withdraw money, check their balance and so on - 4 a fixed sum of money on which interest is paid, lent for a fixed period, and usually for a specific purpose – one that generally pays little or no interest, but allows the holder to withdraw his or her cash without any restrictions 6 a card which guarantees payment for goods and services purchased by the carholder, who pays back the bank or finance company at a later date – 7 an instruction to a bank to pay fixed sums of money to certain people or organizations at stated times savings / deposit account debit card ATM a loan – current account (GB) – checking account (US) – credit card – standing order

Verb + account = o_ _ n an account o_ _ _ d _ _ _ an account c_ _ s _ an account c_ _ _ g _ sth. to an account w_ _ _ d _ _ _ money from an account d _ p _ _ _ t money in an account d _ _ _ t money from an account (take money from) c _ _ d _ t money to an account (add money to) a current account p_ y _ a small interest s _ tt _ _ an account h _ _ d an account (with ZABA)

Verb + account = open an account overdraw (..) account close an account charge sth. to an account withdraw money from an account deposit money in an account /dı’pozıt/ !!!! debit money from (...) account (take money from) credit money to an account (add money to) a current account pays a small interest (past tense: settle an account paid) hold an account (with ZABA) RB P 57, task III HW: RB pp 56, 57 & 58

MK, p 73 Banks and financial institutions Read and fill in 1 commercial banks 2 investment banks 3 private banks 4 hedge funds 5 stockbrokers 6 Islamic banks 7 non-bank financial intermediaries Vocabulary 1 Vocabulary 2 Handout p 1: read a word and ask a colleague to create a word partnership p 2: PRONUNCIATION PRACTICE

Sixteen tons http://www.youtube.com/watch?v=tfp2O9ADwGk Some people say a man is made outta mud A poor man's made outta muscle and blood Muscle and blood and skin and bones A mind that's a-weak and a back that's strong RE: You load sixteen tons, what do you get Another day older and deeper in debt Saint Peter don't you call me 'cause I can't go I owe my soul to the company store I was born one mornin' when the sun didn't shine I picked up my shovel and I walked to the mine I loaded sixteen tons of number nine coal And the straw boss said "Well, a-bless my soul“ ...

RB pp 56 & 57 (task I) bank account 2) cash 3) in 4) deposits 5) interest 6) loans 7) interest rates 8) depositors 9) shortages 10) borrow 11) central bank 12) goes bust 13) payments 14) debit 15) credit 16) transaction 17) financial services 18) foreign currency 19) securities 20) investments 21) payment system 22) cartels 23) regulators

RB, p 58 BANK STATEMENTS Do you get bank statements from your bank? Do you know anyone (adult) who has no bank account? What are the benefits of having a bank account? What are the drawbacks of not having one? How many people in the world have no access to banking/financial services? (the unbanked or the underbanked) Access to finance varies greatly between countries: ca 5 % in Papua New Guinea and Tanzania 100 % in the Netherlands

MICROFINANCE - providing financial services to low-income clients Is that a good idea in your opinion? Have you heard of some specific examples? Muhammad Yunus (Grameen bank)? Learn more about the first microfinance initiative: http://www.grameen-info.org/index.php?option=com_content&task=view&id=210&Itemid=536 → MK, p 76 Listening Tic-tac-toe Read the terms while they provide the definitions! Round 1 1 Capital 2 conglomerate 3 loan 4 portfolio 5 deposits 6 interest 7 stocks 8 takeover bid 9 bonds Round II 1 merger 2 stockbroking 3 returns 4 bankrupt 5 loan 6 deposits 7 takeover bid 8 deregulation 9 portfolio

Listening cont. Listen for terms defined below: Assets promised by a borrower to a lender if the borrower cannot repay the loan. The managing of investments in ways that produce as much profit as possible while limiting the danger of losses. Reducing risk by investing in a variety of assets / lending money to large number of people.

Listening cont. Listen for terms defined below: Assets promised by a borrower to a lender if the borrower cannot repay the loan - collateral The managing of investments in ways that produce as much profit as possible while limiting the danger of losses – risk management (tool) Reducing risk by investing in a variety of assets / lending money to a large number of people – risk diversification → Questions, p 76

COLLATERAL Assets promised by a borrower to a lender if the borrower cannot repay the loan – collateral Eg. The firm went bankrupt, and because he had used his two homes as collateral when he borrowed money for the company, he lost almost everything he owned. Synonym: security Eg. Mortgage is a loan, usually to buy property, which serves as a security for the loan. secured credit vs. unsecured credit In the majority of bankruptcies, secured credit is repaid before unsecured credit.

→ Role play, p 76 get in teams of 5! (5 roles): pp 145,148,150,152,153 pick a role for each team member study your role ask for help if you have problems understanding follow the chairperson’s cue and discuss the following proposal: The bank should enter the microfinance market in developing countries. HW: MAKE SURE YOU READ ALL THE ROLES – CONSIDER THE DIFFERENT POINTS OF VIEW ON MICROFINANCE

Central banking

Central banking functions Listening: RB, p 61

1a Listening The functions of a central bank: 1) Implementing monetary policy 1a) setting interest rate ceilings and floors 1b) printing money or destroying it 1c) open-market operations 2) Exchange rate supervision 3) Commercial banking supervision 4) Acting as a lender of last resort Read the text carefully, underline words/phrases that seem important/relevant to the topic. Are you sure you understand them? Ask a colleague for help... Do task II

1a Listening I The functions of a central bank: 1) Implementing monetary policy 1a) setting interest rate ceilings and floors 1b) printing money or destroying it 1c) open-market operations 2) Exchange rate supervision 3) Commercial banking supervision 4) Act as a lender of last resort Read the text carefully, underline words/phrases that seem important/relevant to the topic. Are you sure you understand them? Ask a colleague for help... II: A–1b B–1a C–3 D–2 E–4 F–1c

The functions of a central bank Implementing monetary policy Exchange rate supervision (after 1st ppt) 3) Commercial banking supervision 4) Acting as a lender of last resort

Central banking: how can monetary policy help the economy? RB, 62-64 HW: I – 2 Do you understand the words below?... 3 – Read the extract from Schiller, B.R. II Read the text again and fill in the table. Hand in a copy of the table. III Present each type of monetary policy using the framework below. Use the same framework twice. The first time around to describe expansionary monetary policy, the second time to describe restrictive monetary policy. IV Monetary and fiscal policy, p 63-64