Friday, October 26, 2012

Lesson-4 on Bank and Banking Sector



Question: What is Bank Rate?
Answer:
Interest rate at which a central bank will advance short term loans to commercial banks.

Question: What is LIBOR (London Inter Bank Offer Rate) ?
Answer:

The interest rate that the banks charge each other for loans (usually in Eurodollars). The LIBOR is officially fixed once a day by a small group of large London banks, but the rate changes throughout the day.

Question. What is DIBOR (Dhaka Inter-Bank Offer Rate)?

Answer:

Ø    Dhaka inter-bank offer rate (DIBOR), which will help banks get a benchmark interest rate or reference rate.
Ø    In line with the international regulators, the central bank issued a circular in December making the inter-bank offer rate effective from January 01, 2010.
Question. What is European Union (EU)?
Answer:

Ø    The European Union (EU) is an economic and political union of 27 member states, located primarily in Europe.
Ø    The euro is the single currency shared by (currently) 16 of the European Union's Member States

Question: What is Investment Banking? 
Answer:
Financial institution that provides large amounts of long-term fixed capital, primarily for established firms. Investment banks generally take an equity stake in the borrower firm to exercise some influence on its direction and operations. They also act (often jointly) as financial intermediaries by underwriting the sale of new securities. For example, Investment Corporation of  Bangladesh(ICB)

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