【正文】 aw Hill / Irwin 16 42 Chapter Review ? Life Insurance Companies ? The Insurance Principle ? Investments of Life Insurance Companies ? Sources of Life Insurance Company Funds ? Structure and Growth of the Life Insurance Industry ? New Services ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 43 Chapter Review ? PropertyCasualty (P/C) Insurance Companies ? Makeup of the P/C Insurance Industry ? Changing Risk Patterns in Property/Liability Coverage ? Investments by P/C Companies ? Sources of Ine ? Business Cycles, Inflation, and Competition ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 44 Chapter Review ? Finance Companies ? Different Finance Companies for Different Purposes ? Growth of Finance Companies ? Methods of Industry Financing ? Recent Changes in the Character of the Industry ? Other Financial Institutions ? Trends Affecting All Financial Institutions Today ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 45 ? Learning Objectives ? ? To see the significant roles that thrift institutions play in the functioning of a modern economy and financial system. ? To learn about the types of services that thrift institutions offer to the public and who their principal petitors are. ? To understand the principal similarities and differences among the major types of thrift institutions. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 46 Introduction ? Nonbank financial institutions play a vital role in the flow of money and credit within the financial system, especially the home mortgage market and the market for personal savings. ? Recently however, both bank and nonbank financial institutions are “converging” in terms of the services they offer and the markets they serve. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 47 Savings and Loan Associations ? Savings and loan associations (Samp。Ls emphasize longerterm loans, especially mortgage loans. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 48 Savings and Loan Associations ? Samp。Ls to diversify their operations and aggressively solicit new customers. Savings Institutions Source: Board of Governors of the Federal Reserve System 16 49 ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 50 Savings Institutions 02004006008001 , 0 0 01 , 2 0 01 , 4 0 01 , 6 0 01 , 8 0 01961 1966 1971 1976 1981 1986 1991 1996 2020$ Billions Total Financial Assets Total Deposits Data Source: Board of Governors of the Federal Reserve System ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 51 Savings and Loan Associations ? The size of the savings industry peaked in 1988, when total financial assets reached $1,640 billion. ? The sharp decline that followed was the result of large numbers of failures and the conversion of some Samp。Ls during the 1980s and 1990s was that many Samp。Ls need ? sound diversification decisions, ? carefully managed loan portfolios, ? risk management, and ? further relaxation of government regulations. ? Today, more aggressive Samp。Ls, they play an active role in the residential mortgage market. However, they are more diversified in their investments, purchasing corporate bonds and mon stock, making consumer loans, and investing in mercial mortgages. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 55 Savings Banks ? The number of savings banks operating today is small – at most a few hundred. ? They are scattered throughout the ., though they are most prominent in the New England and the Middle Atlantic states. ? The distinction among Samp。 ? taxsheltering vehicles (when taxexempt funds are chosen)。 and ? a safety haven for savings. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 67 Money Market Funds ? However, note that money market fund share accounts are not government insured. ? The differential between the yield on the accounts and the rate of return on money market deposits at banks has also narrowed in recent years. ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 68 Money and Capital Markets in Cyberspace ? More information on savings and loan associations and savings banks can be found at and ? Websites for the credit union industry include and ? Money market funds are discussed on sites like and . ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 69 Chapter Review ? Introduction ? Savings and Loan Associations ? Origins ? How Funds Are Raised and Allocated ? Trends in Revenues and Costs ?Possible Remedies for the Industry’s Problems ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 70 Chapter Review ? Savings Banks ? Number and Distribution ? How Funds Are Raised and Allocated ? Current Trends and Future Problems ? Credit Unions ? Credit Union Membership ? Size of Credit Unions ? New Services Offered ? A Strong Competitive Force ? 2020 by The McGrawHill Companies, Inc. All rights reserved. McGraw Hill / Irwin 16 71 Chapter Review ? Money Market Funds