”制卧台贸易上兰 银行管理学 to interest rates.Seasonal borrowing is being phased out and regulators are under pressure to reduce emergency credit provided. 7.Average interest costs are based on historical performance.They provide no information as to whether future interest costs will rise or fall.Average costs should be used in evaluating historical performance,but not current pricing decisions. 8.The marginal cost of debt is the effective cost paid to acquire one additional dollar of investable funds.The marginal cost of equity is a measure of the minimum acceptable rate of return required by shareholders. 9.Banks should use marginal costs as inputs in their deposit and asset pricing decisions. 10.The composition and cost of bank funds are closely associated with a banks risk profile. The lower the amount of core deposits,the higher is the cost of funds and the greater is liquidity risk 11.The FDIC uses either a payout option or purchase and assumption option in handling a failed bank.It is supposed to choose the one that is lowest cost.Under the payout option, uninsured deposits are not paid in full by the FDIC,while uninsured deposits are paid in full under the purchase and assumption option.This creates the potential for discriminatory treatment. Teaching Suggestions 1.Students enjoy debating the merits of different transactions account pricing schemes. Have them identify the characteristics of the average student's monthly account activity, minimum balances,and number of deposits.Using the Functional Cost and Profit Analysis data in Exhibit 12.3,have students calculate a bank's monthly cost of handling the average account.Estimate the amount of fee income and investment income from investable deposit balances that a bank earns,on average.The typical conclusion is that student activity is high,especially when ATM transactions are included,deposit balances are low,and without fees such as insufficient funds charges,a bank would not earn a profit on the average student's account. 2.Also,the advent of Internet banking will intrigue many students who are more computer-literate than the general population.Open a discussion of who the users of Internet account likely are and the growth opportunities of this type of banking.Have students identify the costs and benefits of Internet accounts and online sales,in general. 3.It is important to demonstrating why cost analysis is useful and which cost estimates are useful for different purposes.Much of the material follows from topics and calculations presented in an introductory corporate finance class on estimating a firm's cost of capital The basic calculations are the same except for differences in the nature of some bank liabilities. 4. Students should compare the issues raised in measuring a small bank's cost of funds versus measuring a large bank's cost of funds.Discuss differences in access to the money and capital markets,especially the national versus local nature of the demand for bank stocks.Questions at the end of the chapter serve as a useful stimulant to additional questions. 第14页共29页银行管理学 第 14 页 共 29 页 to interest rates. Seasonal borrowing is being phased out and regulators are under pressure to reduce emergency credit provided. 7. Average interest costs are based on historical performance. They provide no information as to whether future interest costs will rise or fall. Average costs should be used in evaluating historical performance, but not current pricing decisions. 8. The marginal cost of debt is the effective cost paid to acquire one additional dollar of investable funds. The marginal cost of equity is a measure of the minimum acceptable rate of return required by shareholders. 9. Banks should use marginal costs as inputs in their deposit and asset pricing decisions. 10. The composition and cost of bank funds are closely associated with a banks risk profile. The lower the amount of core deposits, the higher is the cost of funds and the greater is liquidity risk. 11. The FDIC uses either a payout option or purchase and assumption option in handling a failed bank. It is supposed to choose the one that is lowest cost. Under the payout option, uninsured deposits are not paid in full by the FDIC, while uninsured deposits are paid in full under the purchase and assumption option. This creates the potential for discriminatory treatment. Teaching Suggestions 1. Students enjoy debating the merits of different transactions account pricing schemes. Have them identify the characteristics of the average student's monthly account activity, minimum balances, and number of deposits. Using the Functional Cost and Profit Analysis data in Exhibit 12.3, have students calculate a bank's monthly cost of handling the average account. Estimate the amount of fee income and investment income from investable deposit balances that a bank earns, on average. The typical conclusion is that student activity is high, especially when ATM transactions are included, deposit balances are low, and without fees such as insufficient funds charges, a bank would not earn a profit on the average student's account. 2. Also, the advent of Internet banking will intrigue many students who are more computer-literate than the general population. Open a discussion of who the users of Internet account likely are and the growth opportunities of this type of banking. Have students identify the costs and benefits of Internet accounts and online sales, in general. 3. It is important to demonstrating why cost analysis is useful and which cost estimates are useful for different purposes. Much of the material follows from topics and calculations presented in an introductory corporate finance class on estimating a firm’s cost of capital. The basic calculations are the same except for differences in the nature of some bank liabilities. 4. Students should compare the issues raised in measuring a small bank's cost of funds versus measuring a large bank's cost of funds. Discuss differences in access to the money and capital markets, especially the national versus local nature of the demand for bank stocks. Questions at the end of the chapter serve as a useful stimulant to additional questions