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Banking certificates of deposit and saving certificates. Bank bills. Interbank loans



Category: Concept of the Bank and the Banking System

Kind of term deposits and savings deposits are deposits and savings certificates.

Deposit or savings certificate — a written certificate of the issuing bank’s contribution of funds, certifying the right of the depositor or its assignee to receive money after the due date and interest thereon.

Certificates may be registered, bearer may be transferred or donated. Certificates can not be a settlement or a means of payment for goods sold and services rendered.

Certificates of deposit issued in large amounts and must be purchased by legal entities. The right to demand certificates of deposit may be transferred only to legal entities.

World bank practice known two types of certificates of deposit. Non-negotiable certificates of deposits are kept by the depositor and presented them to the bank after the expiration. Transferred (traded), certificates of deposit can be transferred to another person through the purchase and sale them on the secondary market.

Commercial banks may issue emergency certificates of deposit with a maximum maturity of up to 1 year. In Western practice passed certificates of deposit are issued for a period of 14 days to 18 months.

Savings certificates are designed to implement physical persons. Term of circulation term savings certificates may not exceed 1 year and 3 years, if the conditions of their release are compatible with the Central Bank. If the term deposit receipt or deposit of the certificate has expired, then this certificate is a document on demand. The Bank shall pay the amount stated therein on the first request of the owner. Savings Certificates may be transferred only to an individual.

Term deposit and savings certificates may be presented for payment before the deadline, if it is stipulated in the contract of purchase certificate. In this case the bank shall pay interest on the actual period of use of funds. For a commercial bank the benefits of these forms of accumulation of resources is that large sums accrue to the bank’s strict deadline and increase thus the most stable part of the credit.

Bank bills

Among the new forms of mobilization credit should include bank bills. Banks issue only the promissory notes. The advantage of bank bills is that they can be used: to pay for goods and services, as collateral for obtaining loans, legal entities and individuals, have a sufficiently high liquidity, high interest rates, there are no restrictions on the transfer of bills entity or person ; have different urgency.

Private commercial banks to release foreign exchange bill, which expands their ability to accumulate credit in foreign currency.

Interbank loans

In practice, banks are widely used loans purchased from other commercial banks or the Central Bank.

Interbank loans — a form of term loans, which are the owners of commercial banks. For lending to government programs, especially those connected with the support of the agricultural sector, are widely used centralized resources of the Central Bank.

Feature of the use of these resources are:

— The lack of reserves;

— Limit the interest rate for lending at the expense of centralized resources.


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