【正文】 ? a temporary repository for liquid funds。Ls, savings banks, and mercial banks is being blurred, especially because they are readily convertible from one form to another. Savings Institutions Source: Board of Governors of the Federal Reserve System 16 56 ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 57 Savings Banks ? The savings bank industry faces a number of problems that will significantly affect its future as a conduit for savings and investment. ? In particular, savings banks have inflexible asset structures and face petition from other financial institutions. ? Their future growth depends on their ability to gain the necessary changes in government regulations to allow them to respond to changing financial market conditions. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 58 Credit Unions ? Credit unions are cooperative, selfhelp associations of individuals, and savings deposits and loans are offered only to members of each association. ? Credit unions came to the . in 1909, and their longrun survival stems mainly from their being able to offer low loan rates and high deposit interest rates and from their relatively low operating costs. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 59 Credit Unions ? Credit unions are anized around a mon affiliation or bond among their members. Most members work for the same employer, or for one of a group of related employers. ? There is a strong shift today toward fewer, but larger, credit unions. The decline is due primarily to mergers, failures, and a structural shift in the . economy from manufacturing industries toward more service industries. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 60 . Credit Union Statistics 1940 9,224 2,693,863 249 1950 10,586 4,617,086 1,005 1960 20,094 12,025,393 5,651 1970 23,687 22,775,511 17,872 1980 21,465 43,930,569 68,974 1990 14,049 60,087,256 216,874 2020 10,684 79,751,873 449,799 Year Number of Credit Unions Number of Members Assets ($ Millions) Data Source: Credit Union National Association ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 61 Credit Unions ? . credit unions are under intense pressure to develop new services and perate new markets due to increasing petition from other financial institutions and a decline in the demand for their historically most important credit service – automobile loans. ? However, the industry has repeatedly shown its capacity for service innovation and its ability to pete successfully for both consumer loans and savings accounts. Credit Unions Source: Board of Governors of the Federal Reserve System 16 62 ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 63 Money Market Funds ? In 1972, the first money market mutual fund – a financial intermediary pooling the savings of individuals and businesses and investing those monies in shortterm, highquality money market instruments – opened for business. ? The fund offered share accounts whose yields reflect prevailing money market rates. In contrast, the interest rates on most bank deposits were then restrained by government regulation. Money Market Funds Source: Board of Governors of the Federal Reserve System 16 64 ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 65 Data Source: Board of Governors of the Federal Reserve System Money Market Funds ? On the whole, money market funds hold highquality assets. The short maturity of the assets results in a highly liquid security portfolio that can be adjusted quickly to suit changing market conditions. ?They are mostly “no load” funds – there is no mission charge for opening an account, purchasing more shares, or redeeming shares. The accounts can be accessed easily too. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 66 Money Market Funds ? Today, money market funds serve as ? cashmanagement vehicles where market rates can be earned on funds used for daily transactions。Ls are branching out in at least three different directions – real estate models, family financial centers, and diversified models. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 54 Savings Banks ? Savings banks began in Scotland in the early 19th century, and then took root in the . about 150 years ago to meet the needs of the small saver. ? Like Samp。L assets (fixedrate mortgage loans) were interestrate insensitive while most of their liabilities (deposits) were highly sensitive to interest rates. ? So, during periods of rapidly rising market interest rates, the industry’s interest margin were severely squeezed. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 53 Savings and Loan Associations ? Samp。Ls into other kinds of financial institutions, most notably mercial banks and savings banks. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 52 Savings and Loan Associations ? One primary cause for the low profitability of Samp。Ls began essentially as a singleproduct industry in the early 19th century, accepting savings deposits from middleine ind