Commercial Banking
Complete the text using these words:
accounts	bank loan	cheque	customers'
current account	debt	depositors	deposits
lend	liabilities	liquidity	optimize
overdraft	salary	spread	standing orders
return	transfer	wages	withdraw
Commercial banks are businesses that trade in money. They receive and hold (1)............pay
money according to (2)...........instructions, (3)...........money, etc
There are still many people in Britain who do noc have bank (4)........... . Traditionally,
factory workers were paid (5) ...........in cash on Fridays. Non-manual workers, however, usually
receive a monthly (6)............. in the form of a cheque or a (7)............ paid directly into
their bank account.
A (8) . *., i......(US; checking account) usually pays little or no interest, hut allows the holder
to (9)........... his or her cash with no restrictions. Deposit accounts (in the US also called time
or notice accounts) pay interest. They do not usually provide (10)........... (US: check) facilities,
and notice is often required to withdraw money. (11)......, . , , . and direct debits are ways of paying
regular bills at regular intervals.
Banks offer both loans and overdrafts. A (12) ... ,.......... is a fixed sum of money, lent for a
fixed period, on which interest is paid; banks usually require some form of security or guarantee before
lending. An (13)........... is an arrangement by which a customer can overdraw an account, i.e.
run up a debt to an agreed limit; interest on the (14) ,.....«, , , , is calculated daily.
Banks make a profit from the (15) .... ,......or differential between the interest rates they
pay on deposits and those they charge on loans. They are also able to lend more money than they receive   in   deposits because
(16).........„.. rarely
withdraw all their money at the same time.    In order to
(17)........■. .. the return on
their assets (loans), bankers have to find a balance between yield and risk, and (18) and different maturiries, and to match    these    with their
(19) ........... (deposits).
The maturity of a loan is how long it will last; the yield of   a   loan   is   its annual
(20)...........- how much
money it pays - expressed as a percentage.
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