Business of Banking

1) Executive Functions2) The Teller Functions

3) The Book keeping Functions

A banker must of necessity be faced with policy-making with establishing harmonious relations with customers in order to get business, with gathering facts and figures about the depositors and debtors, with recruiting personnel to do the minor operations, and with similar duties involving the caliber of an executive.

The banker must be a man of creative managerial ability. He should possess a charming personality. He should be prudent and patient and must possess an above average intelligence if possible.

Be the Bank, not the Banker

After the bankers shall have built up a clientele, he must then act as teller in manifold ways.

He accepts deposits, he changes checks for cash, he changes big bills with smaller denominations, he releases the checks or cash representing loans, he received payment for loans. And such other teller functions.

To be an efficient teller, the person must be patient, understanding, accurate and careful, if not cautious.

For a mistake in paying or receiving money may make or unmake a teller.

To keep a faithful record of the events and accounts passing through his hands, the banker must record the figures and sometimes the facts. This requires bookkeeping knowledge.

He may also be called upon to summarize and interpret the facts and figures. This latter position requires accounting ability.

A potentially efficient banker must possess a character above suspicion and integrity of the highest order.

He should be patient, understanding, cordial, and respectful.

He should be well versed in banking principles and practices.

He should have a good command in the medium of communication.

He should have a working knowledge of law, economics, accounting, management, public relations, and business psychology.

-A banker must be a “jack of all trades; master of all.”-

Business of Banking

In allowing the flow of credit funds, the banks become significant in the economy because they can create money out of loan proceeds.

If a bank abuses this power, it will create havoc in the company.

On the other hand, if the bank exercise wise judgment in this particular aspect, it will contribute tremendously to the economic well being along the commercial, industrial, and even agricultural endeavors.

The banks, therefore, may or may not contribute to the development of the country.

By its functions of giving expert advice to businessmen, the bank may contribute to the success (or failure) of the country as a whole.

Since bank exercise prudence in giving such advice, it usually turns out that they contribute to wise decisions and proper incentives in business and trade.

The Banks came out of the need to facilitate trade transactions, particularly credit transactions.

A bank also facilitates the dealings between debtors and creditors because it acts as an intermediary in the flow of Credit Funds.

It allows others the use of otherwise idle funds of the community in productive activities.

For the person depositing money are usually those who have no immediate need for the funds and the bank, in turn lend these funds to those who are momentarily in need of them.

Without banks, Foreign trade would stagnate or perhaps not flow smoothly.

The major link between international buyers and sellers are the banks. They influence and allow the continuous and successful flow of foreign trade.

This is more evident when the banks doing business in the international network are world renowned.

International trade necessitates the letter of credit and acceptance which banks handle with the greatest care due to their wealth of experience in dealing on credit.