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According to the General Banking Act, the terms bank refers to an entity daily authorized

by the monetary board of the Central Bank that may engage in the lending of funds
obtained from the public through the receipts of deposits of any kind and an entities
regularly conducting such applications.

Banks serves as depositing of idle funds individuals having excess funds deposits then in
bank for the interest and services that they may action.
Banks defined
Role of Banks

- Saving and Mortgage Banks
- Stock Saving and loan associations
- Private Development Banks
Classification of Banks
1. Land Bank of the Philippines
2. Development bank of the Philippines
3. Al- Amanah Islamic Instrument
Bank of the Philippines
Offshore Banking Unit (OBU)
Specialized Government Bank
of the Philippines
Classification According to Form of
1. Private Owned Banks
2. Government Owned Banks

1. Domestic Bank
2. Foreign Bank
Traditional Classifications of Banks
According to Place of Incorporation
1. Depository Functions
2. Trust Functions
3. Collection and Remittance Function
4. Loans and Discount Functions
5. Advisory Function
Functions of Bank
1. Deposits from the private sector
2. Deposits from the government

1. Saving Deposits
2. Demand Deposits
3. Term Saving Account
4. Special Time Deposit
5. Time Certificate of Deposit
Classifications of Deposits to a
Different Criterion
According to the Form of Withdrawal

For depositing and withdrawing money.

1. Insert the ATM card into the slot machine and wait for the word ready
on display.
2. Then keys the personal identification number (PIN) and proceed with the
desired transactions as instructed by the machine.
Automatic Teller Machine (ATM)
How the ATMs Work to the use of ATM
1. The Single name/individual account
2. Joint Account
3. Sole Proprietorship Account
4. Partnership Account
5. Corporate Account
6. Fiduciary Account
7. Un-incorporate group of Account
* Inactive Deposit Account (Dormant Account)
* Insurance in Deposits (PDTC)
Types of Bank Accounts
1. Demand or Callable Loan
2. Time Loan

1. According to purpose
2. According to the form on how credit is granted
3. According to maturity
4. According to release of the loan
5. According to the manner of repayment

Types of Loans granted by Banks
Other Classifications of Bank Loans:
The central bank has responsibility of administering the monetary,
banking and credit system of the Republic. Therefore the Bank should
have achieved the ff. objectives:

Primarily to maintain internal and external stability in the Philippines.
To reserve the international value of the peso and the convertibility of
the peso in other convertible currencies.
To faster monetary, credit and exchange conditions conductive to a
balance and sustainable growth of the economy.
To maintain price stability in the economy.
The BANGKO SENTRAL is the only bank authorized to
manufacture and issue money. As the bank of issue money.
Control of the discount and rediscount rates on loans
The bangko Sentral extends credit to banking institutions for
the following purposes:
Using it as device for credit control
To increase the liquidity of the banks through credit whenever
Legal bank reserve refers to the portion of the banks deposit liability that cannot be
available for lending. Instead, it will have to be set aside, as a reserve in the Bangko
Sentral, vaults of the bank or temporarily invested in government securities depositions.
The control of the percentage of the bank reserve is a powerful and effective instrument
that the Bangko Sentral may use in order to effect an expansion on contraction of money

As a monetary device for credit Expansion and Contraction
To protect the interest of depositors by not allowing the bank to use all the deposits for
lending operations.
The pool of legal reserve may be used by the bangko sentral to help banks in financial

Legal Bank Reserve Requirements
Purposes of Imposing Legal Bank Reserve
The pool of legal bank reserve deposit may also used by bank in their
interbank call loan system This system is one where by a bank with
deficiency in its bank reserve deposits could borrow from a bank with
excess reserve deposits. The lending bank imposes a percentage of

The pool of Bank reserve deposits it also utilized in the settlement of
bank claims and counter against each other arising from the operation
of checking account system where the Bangko Sentral Acts as the
cleaning house.