Overview of Banking Science
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ScribdTranslationsOverview of Banking Science
Translated by
ScribdTranslationsBanking Science
Science is recognized as the greatest source of knowledge in the
the modern world is the greatest collective work in the history of humanity.
One of these is banking science, which arises as a contribution to the solution of
the conflicts of banking law.
Banking science is the body of knowledge about banks and
systematically structured banking systems obtained through the
observation of regular patterns, reasoning, and experimentation in
specific areas, from which questions arise, are constructed
hypotheses, principles are deduced, and general laws and schemes are developed
methodically organized on banks and banking systems.
History
The banks in Roman times did not operate like modern ones. The
most banking activities were carried out by individuals and not
by institutions. The large investments were financed by the
faenerators, while those who worked professionally in the
money and credit business were known by various names, such as
bankers (argentarii), money changers (nummularii), and collectors (coactores).
During the 1st century, banks in Persia and other territories in the Empire
Sasanids issued letters of credit known as sakks. It is known that the
Muslim merchants Karimí have used the cheque or sakk system.
since the time of the Abbasid caliphate under Harun al-Rashid. In the 9th century a
Muslim businessman was asking for cash in the primitive form of a check.
developed in China about the fountains in Baghdad, a tradition that has been reinforced
significantly in the 13th and 14th centuries, during the Mongol Empire.
In fact, the fragments found in the Cairo Genizah indicate that in
in the 12th century checks very similar to ours were in use, only that they were more
small to save costs on paper. They contain an amount, to whom
must be paid, to the order of, the date and the name of the issuer are likewise
evident.
The first modern bank was founded in Genoa, Italy in the year 1406.
its name was Banco di San Giorgio. The first banks appeared in the
Renaissance period in cities like Venice, Pisa, Florence, and Genoa.
The name 'bank' derives from the Italian word 'banco', 'desk'.
used during the Renaissance by Florentine Jewish bankers who
they made their transactions over a table covered with a green tablecloth.
The members of the Fugger or Fúcares family from Augsburg, along with
The Welser were the bankers of the kings Charles I and Philip II of Spain.
After the Siege of Antwerp, the financial center moved to Amsterdam
until the Industrial Revolution. In the year 1609, the bank was founded there.
Amsterdamsche Exchange Bank. The bank offices were located in the
trade centers, the largest of which were during the century
the ports of Amsterdam, London, and Hamburg. Some people
they could participate in the lucrative trade of the East Indies through the
purchase of bank credit letters.
During the 18th and 19th centuries, there was massive growth in the
banking activity. Banks played a key role in the movement of
gold and silver coins based on paper currency, redeemable for their holdings.
For overall economic stability and as a guarantee for clients, it was made
necessary during the 20th century the establishment of financial regulation in
almost all countries, to establish the minimum standards of the activity
banking and financial competition and avoid or face potential bankruptcies
banking, especially during economic crises.
Since 1980, there have been ethical or social banks whose objective was to
financing of social, environmental, and cultural projects rejecting
any type of speculation with said funds.
Origin of the Expression Bank
It originates from the public loans contracted by the cities
Italians at the beginning of the 12th century. Indeed, public loans were
called Monti in Italy, which means common fund. At that time
the Germans, who had a great influence in Italy began to designate
the common fund, constituted by the contributions of several people, with the
expression Bank, along with the equivalent term Monte. Shortly
time Bank was Italianized to Bank and the accumulation of loans
public places were indiscriminately called Mountain or Bank.
Bankers in the Middle Ages
The bankers were in charge of moving money from one
zones to others with security. Although there are many formulas, one of the most
utilizadas era la siguiente. Un comerciante quiere pagar a otro que vive en otra
city. To do this, deposit money in the bank of your city. This banker has
branches in other cities. A document is sent to them in which it
asks for that amount to be delivered to another trader in the second city. From
In this way, money was moved without physically doing so.
Bankers were also responsible for safeguarding money and negotiating.
the promissory notes and later of giving credits.
Functions of modern banks
Banks are institutions that act as intermediaries, that is,
they not only act as a passive conduit between lenders and borrowers,
but play a more active role because they take on for themselves
the same certain risks influencing in this way on the activity
general economics.
Functions:
Preserve the value of the currency and maintain stability of
prices.
Maintain the stability of the financial system.
Ability to capture business.
The Intermediation of Credit.
The intermediation of payments.
The management of capital.
Sources of banking law
Banking law is an informational law, delimited
subjectively by the banking entrepreneur, who groups a set of rules
heterogeneous, which regulate the status of market intermediaries
banking and its typical operations. In that set of rules, one can appreciate
different natures and functions, there is a duality of norms, two
fundamental dimensions, one institutional and the other functional. They are:
The Constitution.
Banking legislation.
Regulations governing banking activities.
The uses and customs.
The international sources.
The uses and customs.
Bank classification
According to your property:
Public banks: They are those whose capital is provided by the
State.
Private banks: They are those whose capital is provided by
individual shareholders.
Mixed banks: Their capital is formed with private contributions and
officials.
Multilateral banks: Their capital is made up of contributions from
various states under an international agreement.
According to your activity
Commercial banks: Those that operate with the public in
general and they earn through financial intermediation and the
mainly consumer credit. Its usual operations
include checking accounts, savings accounts,
loans, collections, payments and collections for third-party accounts,
custody of securities and values, rental of safety deposit boxes and
financing.
Investment banks: They are organizations that ensure and
distribuyen nuevas inversiones de valores y ayudan a los
businesses to obtain financing.
Development banks: They have a specific credit purpose.
They include development banking, mortgage banking, etc.
Central banks: It is the monetary authority par excellence in
any country that has developed its financial system. It is
an institution that is almost always state-owned, which has the function and the
obligation to direct the government's monetary policy.
Banking activity
It acts as an intermediary between savers and
borrowers, what is considered the typical or usual activity of
a bank, this is receiving funds from the public that they bring.
paired with the obligation of their return, applying them on account
own to the granting of loans or analogous operations
nature. Therefore, the distinguishing feature of this type
regarding entities compared to other financial intermediaries is to have
reserved by law, with exclusive and excluding character, the
fundraising activity when it does not consist of
issuance of securities or instruments subject to regulation of the
stock market
Assume a debtor position towards the client. The user
he has capital and deposits it in a financial institution, with
the objective of obtaining economic returns and benefits
in terms of security and availability.
The financial entity takes a creditor position against
user. The user needs capital and the entity provides it to him
provides in the form of payroll loans, for free investment,
mortgage credits, credit cards, etc.