Financial Management in Banking Sector

13th October 2021 0 By indiafreenotes

Economic management of the country is possible through its monetary and financial controls which need to be properly planned, monitored and controlled. Financial planning brings about synchronization between the use of human resources and other resources in the country.

Banking management is one of the important tools for identification and implementation of monetary policy. Analysis of banks performance and implementation of monetary policies show us what policies are working and what policies are not and then put them on the table of bank managers and financial institutions.

A bank is a financial institution licensed to receive deposits and make loans. Two of the most common types of banks are commercial/retail and investment banks.  Depending on type, a bank may also provide various financial services ranging from providing safe deposit boxes and currency exchange to retirement and wealth management.

Above all, central banks are responsible for currency stability.  They control inflation, dictate monetary policies, and oversee money demand and supply in the market.  Commercial or retail banks offer various services including, but not limited to, managing money deposits and withdrawals, providing basic checking and saving accounts, certificates of deposit, issuing debit and credit cards to qualified customers, supplying short-and long-term loans such as car loans, home mortgages or equity line of credits.  Investment banks gear their services toward corporate clients.  They provide services such as merger and acquisition activity and underwriting among other investment services.

Addressing this basic need is the main motivation behind establishing this department at Avicenna University. This may help knowledge development at the country’s monetary and financial institutions addressing needs of banks, monetary and financial institutions in private and public sectors that need quality human resources.

Financial management banking is a field where students will get familiar with the analytical and descriptive aspects of money, banking, basics of management, financial and human resources management, legal discussions and accounting. The graduates of this field has various kinds of employment opportunities in banks and furthermore they will also be working in the national banking (financial and monetary planning, organizational structure, management of branches, credits, information, investment, public relation, and other services and also international banking (imports, credits, documents, arbitrages and other affairs).

Students of this field can use series of decision-making models and quantitative methods like statistics ad researches to determine policies and strategic programs for success of financial institutions.

According to the finance and development department of the International Monetary Fund (IMF), financial services are the processes by which consumers or businesses acquire financial goods.1 For example, a payment system provider offers a financial service when it accepts and transfers funds between payers and recipients. This includes accounts settled through credit and debit cards, checks, and electronic funds transfers.

Companies in the financial services industry manage money. For instance, a financial advisor manages assets and offers advice on behalf of a client. The advisor does not directly provide investments or any other product, rather, they facilitate the movement of funds between savers and the issuers of securities and other instruments. This service is a temporary task rather than a tangible asset.

Financial goods, on the other hand, are not tasks. They are things. A mortgage loan may seem like a service, but it’s actually a product that lasts beyond the initial provision. Stocks, bonds, loans, commodity assets, real estate, and insurance policies are examples of financial goods.

Financial Management and Banking Field Objectives

  • Training and developing the capacities of human resources in the area of financial management and banking.
  • Developing technical capacities of human resources for addressing the needs of market, institutions and banks at the private and public sector.
  • Preparation of students for higher education including master and PHD degree in the relevant field.

Some of the reasons why banking tops the list of pillars required in financial literacy.

  • Safeguard your cash.
  • Facilitate financial transactions.
  • Insure your liquid assets.
  • Earn interest.
  • Borrow loans.
  • Invest your money.
  • Use debit and credit card services.
  • Receive your paycheck quickly using direct deposit.
  • Manage your finances; Record keeping and budgeting.
  • Establish a credit history to generate a FICO credit score instrumental in borrowing funds and building wealth.