What Should I Know About Banking?

May 13, 2015 | By More
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What Should I Know About BankingHow much do you know about the banking industry?  At the minimum, do you feel fairly comfortable about the products, services, and inner workings of your home financial institution?  The truth is that the world of money and banking for consumers has become more complicated, particularly with the extreme growth in technology over the last ten years.  It’s our purpose today to provide you several website shares that will introduce good information so you become more familiar with banking.

The first website to visit is Khan Academy, which has a series of 18 excellent videos that take banking and the financial system to the next level.  Friends, you’ll have the opportunity to understand aspects of banking and the financial system that not everybody takes the time to absorb.  And, for those of you who are interested in growing your career to the executive level of whatever industry you choose, it’s critical you know this information.  Believe me, you’ll be three steps ahead of your competition.

Here is a short list of some of the concepts you’ll watch:

√  A Bank’s income statement
√  Reserve ratios
√  Fed Funds rate
√  LIBOR
√  The Federal Reserve system

Another helpful resource is at Investopedia by Stephen Simpson.  He wrote a series of 13 articles highlighting various key areas of understanding how banking works.  The focus on commercial banking will introduce you to the basics, to general economic concepts, how banks make their money, to an explanation about the Federal Reserve System.

The truth is, like any industry, you can dig as deep into the well as you want to learn how all aspects of it works.  For many consumers, digging into the details of banking simply won’t be of interest.  But, again, if you are a consumer who wants to make your financial institution a key partner in your money lifestyle, it’s to your benefit to understand the system.

In closing, I want to again reiterate.  If you plan to move beyond the lower rungs of management and move your way up the ladder, even into entrepreneurship at a later time, it’s to your advantage to understand the workings of a bank.  After all, you will deal with them for the business accounts, lending, and even capital if you start your own business.

Tips to Read:

Money, banking and central banks, Khan Academy website

The Banking System: Commercial Banking – How Banks Make Money, by Stephen D. Simpson, CFA,   Investopedia.com

Homework:

Take the opportunity to review some of our Posts that talk about what happens at a Board of Directors meeting in a typical bank.  These include Board of Directors & Your Bank: What Happens on Board Day and Board of Directors & Your Bank: What Do They Do?

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Category: Banking, Career, Money Tips on the Web, Resources & Websites

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