UNIT 3

BANKING

Banks are financial institutions authorised by the government to accept deposits, pay interest,
clear checks, make loans, act as an intermediary in financial transactions, and provide other
financial services to its clients. They make money on the interest they charge on loans. The
interest is higher than the interest they pay on depositor's accounts.
There are different types of banks: central banks, investment banks, retail banks, commercial
banks, online banks, and others. Different types of banks specialize in different lines of
business. The Central Bank acts as banker to the other banks. It controls the monetary
policy, lends money in crisis situations, establishes the currency rate, and monitors the
money supply of a country, issuing banknotes and coins.

I. Basic terms:

account
An amount of money deposited with a bank, as in a checking or savings account: My
account is now with Raiffeisen Bank.
ATM (Automated Teller Machine)
A computerized telecommunications device that provides the customers of a financial
institution with access to financial transactions in a public space without the need for a human
clerk or bank teller: Smaller indoor ATMs dispense money inside convenience stores and other
busy areas
cash
Money in the form of coins or banknotes, esp. that issued by a government: If you do not
have an adequate credit card, you can pay with cash.
cheque
Written order, usually on a standard printed form, directing a bank to pay money: I never
use travellers’ cheques these days.
coin
Piece of metal stamped and issued by the authority of a government for use as money:
From 1 January 2007 Slovenia’s currency became the euro, and euro banknotes and coins
became legal tender
commission
Sum or percentage allowed to agents, sales representatives, etc., for their services:
CreditCard Optimisation Service will reduce commission rates and service charges.
credit card
Card entitling its holder to buy goods and services based on the holder's promise to pay
for these goods and services: The use of credit cards originated in the United States during the
1920s.
currency
Coins and banknotes that belong to a particular country: Our national currency the Leu is
backed by the government.
debit card
Electronic check; the funds are withdrawn directly from either the bank account, or from
the remaining balance on the card: Visa debit cards make everyday purchases quick and easy.
deposit
Money placed in a bank account or an instance of placing money in a bank account: This
type of deposit should pay a higher rate of interest.
embezzlement
Stealing of money entrusted to one's care: An owner-manager can loose a great deal of
money before even suspecting that embezzlement might be going on.
exchange
The amount of the difference in value between two or more currencies, or between the
values of the same currency at two or more places: Why don’t you use this currencies and
convertion calculator for exchange rates?
installment
Any of several parts into which a debt or other sum payable is divided for payment at
successive fixed times: It's possible to pay for most things in installments these days.
interest
Sum paid or charged for the use of money or for borrowing money: Banks charge high
interests despite the crisis.
laundering
Concealing the source of illegally gotten money: Money laundering regulations should
be strictly obeyed.
mortgage
Agreement by which somebody borrows money from an organisation and gives that
organisation the right to take possession of property given as security if the loan is not repaid:
You have to secure your mortgage by real property.
note
Promissory note, payable on demand, issued by an authorized bank and intended to
circulate as money:
payer
Person who pays:
payee
Person to whom a check, money, etc., is payable:
teller
Person employed in a bank to receive or pay out money over the counter:
withdrawal
The act of taking money from a bank or the money taken out:

II. Language focus

Reported Speech
In direct speech we give the exact words of the speaker, while in indirect speech we report what
somebody has said using our own words. We change the pronouns, names according to the
meaning of the reported sentence.
Requests and commands are reported with the infinitive:
“Open the door!” He ordered me to open the door.
“Don’t feed the cat! He told me not to feed the cat.

Reported statements

When the main clause contains a verb in the past tense the verb of the subordinate (object clause)
remains in the same tense:
e.g.: “I broke the vase yesterday”. He tells me (that) he broke the vase yesterday.

When the verb in the main clause is in the past tense all the tenses in the subordinate clause
move back into the past:

Direct Speech Indirect Speech

Present Simple Past Simple
Present Continuous Past Continuous
Present Perfect Simple Past Perfect Simple
Present Perfect Continuous Past Perfect Continuous
Past Simple Past Perfect Simple
Past Continuous Past Perfect Continuous
Past Perfect Simple Past Perfect Simple
Past Perfect Continuous Past Perfect Continuous
Future Simple Future in the Past
Future Continuous Future Continuous in the Past

e.g.: “I don’t like soft rock.”-------------He said (that) he didn’t like soft rock.
“Peter is reading a book.”---------He told me (that) Peter was reading a book.
“I have changed my mind.”--------She explained (that) she had changed her mind.

! Modal verbs change too:

may - might
can - could
must - had to / was, were to
have to - had to
will - would
shall – should

e.g.: “I may help you.” - He said (that) he might help me.

! Adverbs and pronouns change too:

here – there
now - then
today - that day
yesterday - the day before / the previous day
last week - the week before / the previous week
tomorrow - the next day / the following day
next week - the next week / the following week
this - that
these – those

e.g.: “I am here.” - He said (that) he was there.

“It is raining now.” - He related (that) it was raining then.
“We should have gone on a trip, if the weather had been fine.” - My friend told me (that)
we should have gone on a trip if the weather had been fine.

Reported questions

When we report questions the word order of the subordinate clause follows the topic of the
declarative sentence.

e.g.: “Where do you live?” - He asks me where I live.

“When are you both leaving?” – He wanted to know when we both were leaving.
“Are you coming?” - He asked me if I was coming.
“Do you eat soup or not?” - He inquired whether I ate soup or not.

1. Turn the sentences below into direct speech:

e.g.: Anna said that she was leaving the company.

“I am leaving the company,” Anna said.

a) Sue said that she was very happy with her new job.
b) Michael said that he enjoyed helping his colleague solve the problem.
c) Olga said that she would give an interview later.
d) Tina said that she had arrived in Liverpool on Monday.
e) Helen said that she had met lots of people at the trade fair.
f) She said that she was leaving at six.
g) She said she would be back later.
h) Thomas said that he had just seen Mark.
i) Helen said that she was working on the new product launch.
j) Joanna said that we were late at the Annual General Meeting.
k) He said he would phone back.
l) David said that he felt all right.

KEY:
a) “I am very happy with my new job,” Sue said.
b) “I enjoy helping my colleague solve the problem,” Michael said.
c) “I will give an interview later,” Olga said.
d) “I arrived in Liverpool on Monday,” Tina said.
e) “I met lots of people at the trade fair,” Helen said.
f) “I am leaving at six,” she said.
g) “I will be back later,” she said.
h) “I have just seen Mark,” Thomas said.
i) “I am working on the new product launch,” Helen said.
j) “We are late at the Annual General Meeting,” Joanna said.
k) “I will phone back,” he said.
l) “I feel all right,” David said.

2. Turn the sentences below into indirect speech:

e.g.: “I'm leaving,” she said.

She said (that) she was leaving.

a) “I saw the film on Monday,” Tom said.

b) “I've missed the bus,” Maria said.
c) “We live in Highland Street,” they said.
d) “I'll phone at 6:00,” Anna said.
e) “I'm having a good time in this department,” said Carol.
f) “We're arriving at 9:00,” they said.
g) “I'm wrong thinking all this,” he said.
h) “I forgot to do my work,” said Alex.

KEY:
a) Tom said he had seen the film on Monday.
b) Maria said she had missed the bus.
c) They said they lived in Highland Street.
d) Anna said she would phone at 6:00.
e) Carol said she was having a good time in that department.
f) They said they were arriving at 9:00.
g) He said he was wrong thinking all that.
h) Alex said he had forgotten to do his work.

3. Rewrite the following sentences in indirect speech:

e.g.: “I'll be late,” said Jim.

Jim said that he would be late.

a) “Kate knows the answer,” said Bill.

Bill said _______________________________________________________.
b) “Mimi is leaving at 8:00,” said Alan.
Alan said ______________________________________________________.
c) “I can't find the keys to the office,” said Dave.
Dave said ______________________________________________________.
d) “The bus is going to be late!” said Mark.
Mark said ______________________________________________________.
e) “I’ve lost my documents,” said Mr Green.
Mr Green said ___________________________________________________.
f) “I have no intention of lending Robert my palmtop computer,” said Tina.
Tina said _______________________________________________________.
g) “What did the car dealer tell you?” Sophia asked me.
Sophia asked ____________________________________________________.
h) “The waitress has made a mistake with the bill,” Paul said.
Paul said ________________________________________________________.

KEY:
a) Bill said Kate knew the answer.
b) Alan said Mimi was leaving at 8:00.
c) Dave said he couldn’t find the keys to the office.
d) Mark said the bus was going to be late.
e) Mr Green said he had lost his documents.
f) Tina said she had no intention of lending Robert her palmtop computer.
g) Sophia asked what the car dealer had told him.
h) Paul said the waitress had made a mistake with the bill.

4. Choose the best answer:

1. “He will come tomorrow”.

She told me that he ________ the next day.
a) is coming
b) will come
c) would come

2. “I see the light at the end of the tunnel.”

She told me that she ________ the light at the end of the tunnel.
a) sees
b) is seeing
c) saw

3. “My mother is taking the bus to work tomorrow”.

He told me that his mother ________ the bus to work the day after.
a) is taking
b) was taking
c) will take

4. “I will call you”.

I told her that I ________ her.
a) will call
 b) would call
c) would have called

5. “I have been there”.

She told me that she ________ there.
a) had been
b) has been
c) was

6. “I will be working in the US next winter”.

I told him that I ________ in the US the following winter.
a) will be working
b) would be working
c) would work

7. “Open the door!”

He asked me ________ the door.
a) to open
b) open
c) opened

8.”I am more than happy to have you here”.

She told me that she ________ more than happy to have me there.
a) has been
b) is
c) was

9. “I can’t do it myself”.
He told me that he ________ it himself.
a) can’t have done
b) couldn’t do
c) couldn’t have done

10. “I am flying to India tonight”.

He told me that he ________ that night.
a) is flying
b) was flying
c) will fly

KEY: 1. C); 2. C); 3. B); 4. B); 5. A); 6. B); 7. A); 8. C); 9. B); 10. B).

5. Turn the following sentences into indirect speech:

1. “Who are you going to leave the house to?” I asked my uncle. “Perhaps,” I went on, “you
should leave it to Sarah as she seems to be the most attached to it.”
2. “Don't imagine that just because I've criticised you, I don't think you're a good musician,” he
said to me. “With enough practice, I have no doubt that you will be able to work as a
professional.”
3. “Is he going to accept the job offer,” she asked, “or will he just continue to stagnate here until
it's time for him to retire?”
4. “I've heard her say that she may give up her job and open a restaurant,” he said. “She's
certainly a good enough cook to do it.”
5. “I needn't have bothered to buy a spare tyre,” she said, “as I didn't have to change the old one
after all”.
6. “I couldn't believe my ears when I heard they'd split up," she said to me. "Could you phone
Jane to see if it's really true?”

KEY:
1. I asked my uncle who he was going to leave the house to and suggested that he (should) leave
it to Sarah as she seemed to be the most attached to it.
2. He told me not to imagine that just because he had criticised me, he didn't think I was a good
musician and assured me that with enough practice, he had no doubt (that) I would be able to
work as a professional.
3. She asked if I thought he was going to/would accept the job offer, or if he would just continue
to stagnate there until it was time for him to retire.
4. He said (that) he had heard her say that she might give up her job and open a restaurant, and
went on to say that she was certainly a good enough cook to do it.
5. She said (that) she needn't have bothered to buy a spare tyre as she hadn't had to change the
old one after all.
6. She told me (that) she couldn't believe her ears when she heard that they had split up, and
asked me if I could phone Jane to see if it was really true.

III. Collocations

1. Read the collocations below for the headword CURRENCY. Fill in the blanks in the
following sentences with the right word. The abbreviations between brackets point to the
grammatical category to be used:

V = verb that comes before the noun

V ~ = verb that comes after the noun
A = adjective
P = phrase

V: accept as, buy, change, convert, devalue, exchange, issue, maintain ~ at a fixed parity to the $,
procure, pay ~ to, strengthen, swap, use ~, withdraw ~
V ~: ~ is under pressure, remained within the 2.25 per cent fluctuation margins, was declared
scarce
A: blocked, common, community, (non)convertible, depreciated, domestic, Euro, foreign,
international, local, national, single (European), stable, strong, weak,~
P: ~ area, crisis, depreciation, exchange, fluctuation, market, rate, regulation, shortage, turmoil,
union; ~ s of the world; unit of ~; freely exchangeable ~; issuing bank for this ~
e.g.: The euro is the ________ (A) currency shared by most of the EU member states.
The euro is the single currency shared by most of the EU member states.

a) Banks should _________ (V) currency at a fixed parity to the dollar.

b) Romania will replace the ________ (A) currency with the euro in 2012.
c) The euro is considered to be a ________ (A) currency with low inflation and low interest
rates.
d) The US currency ________ (V~) today due to the present uncertainty about the direction of
the world economy.
e) We want to find ways to stabilise Europe’s currency ________ (P).

2. Use the headword CURRENCY and the V (verbs), A (adjectives) and P (phrases -
noun+noun constructions) it collocates with to obtain authentic lexical units. Include them
in grammatically correct sentences.

IV. Telephone Banking

1. The following dialogue between a bank representative and a customer is incomplete.

Complete the gaps with the customer’s questions by choosing the one that fits best from the
list below:

Representative: Hello. How can I help you today?

Customer: Hello. I'd like some information on the telephone banking services offered at by your
bank.
Representative: Certainly. What is your account number?
Customer: at the High Street Branch.
Representative: What would you like to know?
Customer: [1]
Representative: Just let me know, I'll sign you up immediately.
Customer: [2]
Representative: You can do all your day-to-day banking over the telephone, 24 hours a day.
Customer: [3]
Representative: Just call the bank, key in your PIN number and listen to the menu of options
available.
Customer: How do I choose which option I want?
Representative: Just press the number for the service stated by the recording.
Customer: [4]
Representative: You can check your balance, pay bills, order a statement or even transfer money
to another bank.
Customer: [5]
Representative: I'm afraid you will have to have a special account for that.
Customer: [6]
Representative: There's an automated answering machine and staff are available 9 to 5 seven
days a week.
Customer: It all sounds very good to me. I'd like to sign up.
Representative: Alright, can you answer a few questions please?
Customer: Certainly...

(http://esl.about.com/od/businessenglishdialogues/a/d_telbank.htm)

A) That's great. How do I access my account?

B) What about getting help if I have any problems?
C) What kind of things can I do?
D) Can you tell me how the telephone banking services work?
E) How do I sign up?
F) That's fantastic! Can I trade stocks and bonds?

2. Match the verbs and nouns concerning banking to obtain useful collocations:

1. transfer a) a check
2. check b) a PIN number
3. order c) money
4. pay d) money
5. follow e) an account
6. key in f) a form
7. sign g) bills
8. deposit h) a statement
9. make i) instructions
10. pay into j) a balance

V. The Euro Debate

• One euro consists of one hundred cents

• ‘euro’ is written without capital letters
• The plural of ‘euro’ is ‘euros’
• The official abbreviation for the euro is EUR
• The symbol is €

1. Transaction costs and risks

Read the following text about transaction costs and risks. In most lines, there is one
incorrect word. Cross it out and write the correct word. If you think the line is correct, put
a tick (√). The first two lines are given as an example:

The most obviously benefit of adopting a single currency is to remove the cost 1. obvious
of exchanging currency, theoretically allowing businesses and individuals to 2. √
consummate previously improfitable trades. For consumers, banks in the 3.
Eurozone must charge the same for intra-member cross-border transactions as 4.
for pure domestic transactions for electronic payments (e.g., credit cards, debit 5.
cards and cash machine withdrawals). 6.
The absence of distinct currencies also remove exchange rate risks. The risk of 7.
unanticipated exchange rate movement has always adding an additional risk or 8.
uncertainty for companies or individuals that invest or trade outside their own 9.
currency zones. Companies that fight against this risk will any longer need to 10.
shoulder this additional cost. This is particularly important for countries who’s 11.
currencies had traditionally fluctuated a great deal, particularly the 12.
Mediterranean nations. 13.
Financial markets on the continent are expecting to be far more liquid and 14.
flexible than they were in the past. The reduction in cross-border transaction 15.
costs will allow larger banking firms to provide a wider array of banking 16.
services who can compete accross and beyond the Eurozone.

(http://en.wikipedia.org/wiki/Euro#Characteristics)

2. Now your opinion!

a) How do you feel about the adoption of the euro as your national currency?
b) How could the introduction of the euro result in a loss of identity for Romania?
c) Why do many EU states want to get rid of the euro?

VI. Services offered by banks

Although the type of services offered by a bank depends upon the type of bank and the country,
services provided to individuals and businesses usually include:
• Accepting deposits
• Giving loans
• Cashing cheques
• Facilitating money transactions
• Issuing credit cards, ATM cards, and debit cards
• Storing valuables, particularly in a safe deposit box
• Exchanging currency
• Offering financial consultancy
• Giving access to online banking
• Providing insurance

1. Accepting deposits

Fill in the gaps with the missing words

Deposit includes a (1) ________ of money accepted from a person or a business on terms under
which it will be repaid with or (2) ________ interest.
Most unauthorized organizations, (3) ________ call themselves “banks” or “finance companies”
or use similar titles often offer very high rates of (4) ________ to attract funds from the public.
Some of (5) ________ institutions have failed and become bankrupt, and the public who invested
funds in such institutions have lost their deposits.
The Central Bank (6) ________ licensed banks and registered finance companies. This
supervision includes off-site surveillance under which information obtained (7) ________ the
relevant institutions are analysed, and on-site examination (8) ________ books and accounts.
The purpose of supervision is to ensure that these institutions conduct their affairs prudently and
take due (9) ________ in handling money deposited with them (10) ________ the public.
As such, the Central Bank (11) ________ not accept deposits or make loans to private
individuals. However, as the banker to the Government, (12) ________ accepts deposits from the
Government, public corporations and international financial institutions. The Central Bank (13)
________ to the Government by means of direct advances and/or by buying Government
securities, (14) ________ as Treasury bills and Registered Stocks. The Bank may (15) ________
lend to commercial banks, which is normally done against the security of Registered Stock.

(http://www.centralbankbahamas.com/faqs.php?cat=18&id=10138)

2. Giving loans

Read the following text about getting a loan and decide if the statements below are true (T) or
false (F).

I want a loan: what to consider?

We live in a world of instant gratification. If we want something, we want it now and we often
go into debt to get it. But what do we need to consider if we're going to take out a loan for
anything other than a home?
The first thing is how to borrow so that it costs as little as possible. The buzz of getting a new car
or going on a fabulous holiday will be a distant memory if you're still paying it off five years
later.
The Consumer New Zealand website says the four golden rules for taking on a loan are:
• Borrow within your means.
• Know what you're in for.
• Shop around.
• Pay the loan back fast.
There are basically three types of loans — specific loans, where you borrow a certain amount
and pay it back in a set period; revolving credit, where you're given a maximum amount of credit
and make minimum repayments (usually each month); and mortgage-related loans, where you
can borrow against any equity in your home (that is the value of your home minus the debt
against it).
Deciding between personal loans, hire purchase agreements, credit cards, overdrafts, line of
credit mortgages or mortgage top-ups is tricky, so you have to do your homework. Basically, it
should come down to the option that is going to cost you the least amount in the long term, so
don't be afraid to ask lenders questions — remember, it's your hard-earned cash they'll be taking.
And make sure you know your rights.
When it's time to apply for a loan, there'll be certain documents and information you'll need to
have ready. This includes identification (particularly if you have no previous relationship with
the lender), pay slips or tax returns that show your recent earnings, as well as information about
any assets and other loans. Many lenders — including banks and credit unions — include loan
application forms or information about the application process on their websites, so it pays to
have a look online before approaching the bank in person.
You should always check your credit file before approaching a lender — this is a rundown of
your credit history and lenders will look at it when deciding whether to give a loan. If you need
the information urgently, you'll have to pay, but if you're prepared to wait, you can get it for free.
Most importantly, don't panic if you discover you have a poor credit history — you may just be
asked to provide a co-borrower or guarantor. This is often a family member or friend who will
take responsibility for the debt if you don't keep up with repayments.
When it comes to signing on the dotted line, the Ministry of Consumer Affairs has provided a list
of questions you should use as one last checklist:
• What will you pay in total for the credit?
• Who will you have to pay and when?
• How many repayments will you have to make?
• How much will each payment be?
• Are there other fees?
• What are your rights to cancel the contract or repay it early?
• Does the lender have security over the goods?
Other things you might want to check include:
• Do the figures add up?
• Do you need insurance for the goods or to cover repayments?
• Are the goods correctly described (for credit sales)?
• Is the lender's request for security reasonable?
• Do I need advice from a budget advisor or legal expert?
If after all this you're still happy to sign, you're probably making the right decision. The loan will
obviously give you what you covet, so enjoy!

(http://money.msn.co.nz/article.aspx?id=451999)

1. When buying a new car or when going on an expensive holiday, taking out a loan will always
be beneficial.
2. With specific loans, a set amount of money is borrowed and given back in ten years’ time.
3. The decision regarding which loan to take is not an easy one.
4. When applying for a loan, the only documents required by the bank are the pay slip or the tax
return to attest one’s recent earnings.
5. When one is a bad debtor, he/she may be asked to provide a guarantor to assume responsibility
for the debt.

VII. Types of banks

Match the following types of banks with their corresponding definitions below:

1. Central bank
2. Commercial bank
3. Merchant bank (GB)/ Investment bank (USA)
4. Savings bank
5. Non-bank bank
6. Piggy bank
7. Offshore bank

a) financial institution that acts as a supplier of loans and credit facilities, however it is typically
not allowed to take deposits from the general public and has to find other means of funding its
operations such as issuing debt instruments

b) a small container, sometimes in the shape of a pig, which is used by children for saving money

c) a bank that provides services to a national government, puts the official financial plans of that
government into operation, and controls the amount of money in the economy

d) a special kind of banking organisation that has been set up to encourage saving by members of
the public and to organise the pool of small savings

e) raises capital for industry, finances international trade, provides fee based corporate advisory
services in relation to mergers and acquisitions

f) refers to banking in which banking institutions execute transactions directly with consumers,
rather than corporations or other banks

h) a bank located in jurisdictions with low taxation and regulation, such as Switzerland or the
Channel Islands; many offshore banks are essentially private banks

VIII. Bank accounts

1. Types of bank accounts

Match the following types of accounts with their corresponding definitions:

1. current account (GB) / demand deposit (USA) / a) a bank account for public money such as those
checking account (USA) of collectors of taxes, government departments
and local government authorities

2. dead account b) one in which money paid in or deposited by a

customer earns interest at a rate which varies with
the bank’s rate

3. deposit account (GB) / time account (USA) / c) a bank account existing in the names of two or
notice account (USA) more persons, often husband and wife

4. joint account d) a bank account into which personal savings are

paid and on which the bank usually pays a
slightly higher rate of interest than on ordinary
deposit accounts

5. public account e) a bank account that you can take money from
 at any time and which usually earns little or no
interest

6. savings account f) an account that is no longer at all active

2. For each blank decide which of the options A, B, C or D is best. ONLY ONE answer is
correct.

1. I would like to open a bank ________ with this bank.

a) examination
b) storage
c) capital
d) account

2. I have two accounts: a checking account and a savings account. I can ________ funds from
one account into the other online.
a) transfer
b) rent
c) order
d) move

3. Each month I have to fill out a bank statement to ________ my checkbook.

a) balance
b) settle
c) boost
d) clarify

4. I want to get the approval for a ________ because I want to start building my house.
a) mortgage
b) safety deposit box
c) pay rise
d) interest

5. When you want to ________ money from an ATM follow all the steps.
a) access
b) freeze
c) debit
d) withdraw

6. This bank account bears little ________.

a) profit
b) interest
c) assets
d) capital
7. Yesterday I received a notice saying that my account is ________ and asking me to mail a
cheque immediately.
a) empty
b) full
c) overdue
d) overrun

8. Although the online payment process failed, they ________ my bank account.
a) opened
b) charged
c) closed
d) inspected

9. You can simply ________ your account via the Internet any time of the day.
a) adapt
b) operate
c) perform
d) resize

10. A ________ account contains only contains enough funds to cover the checks that are issued.
a) zero balance
b) budget
c) building
d) annual

IX. The ATM

Arrange the steps referring to the withdrawal of money in the correct order:

Withdraw at an ATM

1. __________
Follow the on-screen instructions. If you have more than one account (like both checking and
savings) you need to specify which account you want the money to come from. Be sure to push
the savings button. Then specify how much money you want to withdraw.
2. __________
Insert your card and enter your PIN number. If you don't have one, call your bank beforehand
and request one. You will not be able to withdraw money without a PIN.
3. __________
Wait for the machine to process your transaction, then take your receipt, money and card out of
the machine.
4. __________
Use an instant cash card. To do this, you need to already have your debit card set up with your
bank to use at an ATM. Usually, using an ATM affiliated with your bank is best; however, most
cash machines will work but you might incur fees from the ATM owner and/or your bank.
 Withdraw at a Bank

1. __________
The teller will count out the money for you and then you can be on your way.
2. __________
Make a withdrawal at your bank. To do this, you will need to fill out a withdrawal slip that has
your name, account number and the amount you want. If you don't have a book of withdrawal
slips, you can get one at the bank.
3. __________
Take your withdrawal slip to the teller and provide any needed identification.

(http://www.ehow.com/how_2121298_withdraw-money-from-savings-account.html)

X. Online banking

1. Read the following text about online banking and fill in the gaps with the words provided
in the box below:

fee convenient
services pay
number internet
activity website
transfer branch

Online banking or often referred to as (1) ________ banking allows people access to their
accounts through a secured bank-created (2) ________. Nowadays, online banking has become
popular among consumers because it is efficient and (3) ________. Depending on the (4)
________ chosen, a customer may simply be able to view the day-to-day (5) ________ of every
account they have with a bank. With online banking, people are also able to (6) ________ funds,
either between accounts or by electronic transactions. Many online financial institutions allow
people to (7) ________ bills online, usually for a small monthly (8) ________. To sign up, one
needs to visit a local bank (9) ________ and complete necessary paperwork. At this point, they
will receive a user ID and pin (10) ________, which will allow access to the bank's website.

2. What is your opinion about online banking? Can you think of some pros and cons to it?

3. There is one extra word in every line of this list of pros and cons. Underline the extra
words:

Pros
• Online banks don’t have to pay for tellers or the office space rental.
• These banks don’t just serve in a particular country; they serve anyone from all over the
world. As a result, they can offer money in different currencies.
• You can to pay your bills online.
• Most online banks have offer the latest information on the financial market.
• You can actually access to your bank account 24 hours a day, 7 days a week.
• Some online banks offer financial tools that can also help you when it comes to managing
your money.

Cons
• Although banks may seem to offer a lot of these services sometimes they don’t have
everything you need.
• For security reasons, setting it up an account can be time consuming.
• It is rather impersonal. When there is a problem sometimes they don’t have a technical
support team who you can talk to.
• It is often hard to get used to the online banking process. It can take some more time for
you to get accustomed with it.
• Not all banks are authorised. Check out the bank carefully because you don’t want your
money being gone.
• Memorising passwords and PINs can not be a hassle for anyone with a poor memory.

XI. Key factors that drive bank profitability

Starting from the word in CAPITAL LETTERS in the right-hand column, derive another
word that best fits in the context indicated by a blank space:

“How do banks make money?” is a (1) ________ simple question. Banks (1) DECEIVE
make money by charging interest on loans, of course. In fact, there used to
be a standard answer to this question: According to the “3-6-3 rule,” (2) (2) BANK
________ paid a 3 percent rate of interest on deposits, charged a 6 percent
rate of interest on loans, and then headed to the golf course at 3 o’clock.
Like most good jokes, the 3-6-3 rule mixes a grain of truth with a highly (3) SIMPLE
(3) ________ view of reality.
To be sure, the interest margin banks earn by intermediating between (4) BORROW
depositors and (4) ________ continues to be the primary source of profits (5) BANK
for most (5) ________ companies. But banks also earn (6) ________ (6) SUBSTANCE
amounts of non-interest income by charging their customers fees in
exchange for a variety of financial services.
Many of these financial services are traditional banking services: (7) (7) TRANSACT
________ services like checking and cash management; safe-keeping
services like (8) ________ deposit accounts and safety deposit boxes; (9) (8) INSURE
________ services like trust accounts and long-run certificates of deposit (9) INVEST
(CDs); and insurance services like annuity contracts.
In other traditional areas of banking—such as (10) ________ lending and (10) CONSUME
retail payments—the widespread application of new financial
processes and pricing methods is generating (11) ________ amounts (11) INCREASE
of fee income for many banks. And in recent years, banking
companies have taken advantage of (12) ________ to generate (12) REGULATE
substantial amounts of non-interest income from (13) ________ (13) TRADITION
 activities like investment banking, securities brokerage, insurance
agency and underwriting, and mutual fund sales. Remarkably, non-
interest income now accounts for nearly half of all operating income
generated by U.S. commercial banks. (14) ESTIMATE
Many in the banking industry continue to discount, (14) ________, or
simply misunderstand the manner in which increased non-interest income
has affected the financial performance of banking companies. This shift has
been larger than most industry experts expected, and we have only recently (15) PERFORM
begun to understand the implications of this shift for the financial (15)
________ of banking companies.

(http://www.chicagofed.org/publications/economicperspectives/ep_4qtr200
4_part3_DeYoung_Rice.pdf)

XII. Money laundering

Money laundering is increasing in Europe. Regulations against it place a heavy burden on banks
and other financial institutions.

Read the following text about banks’ involvement in the fight against money laundering,
and then answer the questions by choosing one correct answer in each case:

The EU's Second Banking Co-ordination Directive, also known as the Money Laundering
Directive, was issued in 1991. It required member states of the Union to establish similar
regulations for preventing, identifying and reporting money laundering activities. Money
laundering is the process by which criminals attempt to hide the true origins of their money, so
that the money appears to come from a legitimate source. In other words, "dirty" money is turned
into clean money. The availability of hard drugs such as heroin and cocaine has increased
substantially in recent years. As a result, the amount of drugs money being laundered has risen
dramatically. There are also many other serious crimes for which money laundering is required.
You only have to think of terrorist activities, fraud, counterfeiting, extortion, blackmail and
major robberies.
Banks and other institutions are required to set up and operate procedures to combat money
laundering. Banks are required to monitor all their dealings with customers and other banks.
They have to identify those which could possibly be part of a money laundering operation and
report their suspicions to the government's Criminal Investigations Division. Banks must also
take reasonable measures to prevent these activities from happening. The cost of the regulations
is high, in terms of establishing and running computer systems for detection, staff training and
record keeping.

1. Through money laundering, wrongdoers try to:

a) cover the actual provenience of their money
b) disclose the source of their money
c) obey legal procedures

2. In order to prevent bad things from happening, banks must:

a) keep a close eye on their employees
 b) collaborate with the Criminal Investigation Division
c) hire troubleshooters

3. Money laundering involves a lot of expenses because:

a) there are too many problems to solve
b) there is need for specialized logistics and manpower
c) there are exaggerated requirements

A) Case study

I'm currently looking for a loan and I have had no luck with several companies, I’ve tried
companies who even state that they help people with a not so great credit history and I’ve failed.
This is very frustrating because I'm in an extremely good job with a good salary and I'm very
responsible. I made a few mistakes when I was younger as a lot of us do and now I'm paying for
it. I want a loan to clear my credit card. I’ve also looked at ways of maybe securing the loan
against my car but there are no companies who offer that, just logbook loans which don't offer
enough of a loan. Is there anyone who can help? Or knows of any independent lenders? I can
afford monthly payments with no trouble at all and I have minimal outgoings with regards to rent
and bills.

LISTENING, WRITING, SPEAKING

 Listening

 Writing

 Speaking

Verbal input 1 – SHORT PRESENTATION

Read the information below and think about it for 5 minutes. Make a short presentation on
the basis of what is stated or implied in the question you have to answer.

1. “Whenever there is a financial crisis, it is always the banks that get hit.” (Gordon Wu)
2. “Money in the bank is like toothpaste in the tube. Easy to take out, hard to put back.” (Earl
Wilson)
3. “A banker is a fellow who lends his umbrella when the sun is shining and wants it back the
minute it begins to rain.” (Mark Twain)

Verbal input 2 – INTERACTION

Look at the topic below and answer the examiner’s questions.

Topic: Banking

1. How do banks make their money?

2. What is the difference between a credit card and a debit card?
3. What is your opinion about online banking?
4. What are some advantages of an offshore bank account?
5. How does the central bank control the supply of money in circulation?
5. What would you do if a bank deposited one million dollars in your account?
6. Should the government bailout banks and financial institutions?

HUMOUR

A central banker walks into a pizzeria to order a pizza.

When the pizza is done, he goes up to the counter get it. There a clerk asks him: "Should I cut it
into six pieces or eight pieces?"
The central banker replies: "I'm feeling rather hungry right now. You'd better cut it into eight
pieces."

If you owe the bank $100 that's your problem. If you owe the bank $100 million, that's the bank's
problem. (J. Paul Getty)

Bank customer service:

"I'm not saying that the customer service in my bank is bad, but when I went in the other day and
asked the clerk to check my balance ... she leaned over and pushed me."