Banking

Finance Financial markets Financial market participants Corporate finance Personal finance Public finance Banks and Banking Financial regulation For other uses, see Bank (disambiguation). ... Image File history File links Vereinigte_Ostindische_Compagnie_bond. ... The field of finance refers to the concepts of time, money and risk and how they are interelated. ... In finance, financial markets facilitate: The raising of capital (in the capital markets); The transfer of risk (in the derivatives markets); and International trade (in the currency markets). ... There are two basic financial market participant catagories, Investor vs. ... Domestic credit to private sector in 2005 Corporate finance is an area of finance dealing with the financial decisions corporations make and the tools and analysis used to make these decisions. ... Personal finance is the application of the principles of finance to the monetary decisions of an individual or family unit. ... This article does not cite any references or sources. ... Look up Banks in Wiktionary, the free dictionary. ... Financial supervision is government supervision of financial institutions by regulators. ...

Types of Bank Central bank Advising bank Commercial bank Community development bank Custodian bank Depository bank Investment bank Islamic banking Merchant bank Mutual bank Mutual savings bank National bank Offshore bank Private bank Savings bank Swiss bank In international trade, a bank, operating for the exporter in the exporters country, the bank which handles letters of credit for foreign banks. ... A commercial bank is a type of financial intermediary and a type of bank. ... Community development banks (CDBs) are a special kind of bank designed to spur serve the residents of and spur economic development in low to moderate income (LMI) areas. ... In finance, a custodian bank, or simply custodian, refers to a financial institution responsible for safeguarding a firms or individuals financial assets. ... In relation to American Depositary Receipts (or ADRs), a depository bank is a U.S. bank that issues depository receipts. ... To meet Wikipedias quality standards, this article or section may require cleanup. ... Islamic banking refers to a system of banking or banking activity that is consistent with Islamic law (Sharia) principles and guided by Islamic economics. ... In banking, a merchant bank is a traditional term for an Investment Bank. ... A mutual bank is a bank owned by the depositors. ... A mutual savings bank is a financial institution chartered by state or federal government to: (1) provide a safe place for individuals to save and (2) invest those savings in mortgages loans, stocks, bonds and other securities. ... The term national bank has several meanings: especially in developing countries, a bank owned by the state an ordinary private bank which operates nationally (as opposed to regionally or locally or even internationally) In the past, the term national bank has been used synonymously with central bank, but it is... An offshore bank account is a bank located outside the country of residence of the depositor, typically in a low tax jurisdiction (or tax haven) that provides financial and legal advantages. ... Private banks are banks which are not incorporated, and hence the entirety of their assets is available to meet the liabilities of the bank. ... A savings bank is a financial institution whose primary purpose is accepting savings deposits. ... Banking in Switzerland is characterized by stability, privacy and protection of clients assets and information. ...

Banking terms Anonymous banking Automatic teller machine Deposit Deposit creation multiplier Loan Anonymous banking is where the banks of certain countries are used for holding money or assets, based on the voluntary or statutory level of privacy the banks provide. ... Outdoor ATMs may be free-standing, like this kiosk, or built into the side of banks or other buildings An automatic teller machine, automated teller machine (ATM) or cash machine is an electronic device that allows a banks customers to make cash withdrawals and check their account balances without... Bank deposits are the large part of the money supply. They come in different types depending on withdrawal restrictions. ... There are several ways that a government, in coordination with the countries commercial banks, can increase or decrease the money supply of a country. ... For other uses, see Loan (disambiguation). ...

List of banks List of banks in Canada List of banks in Hong Kong List of banks in Singapore This is a list of banks throughout the world. ... // Government Bank of Canada (Central Bank) Business Development Bank of Canada “Big six” banks Royal Bank of Canada Toronto-Dominion Bank Canadian Imperial Bank of Commerce Bank of Montreal Bank of Nova Scotia National Bank of Canada Many of these banks have diversified into financial services that used to be... Hong Kong maintains a three-tier system of deposit-taking institutions, licensed banks, restricted licence banks and deposit-taking companies. ... This is a list of banks with operations in Singapore. ...

An American Depositary Receipt (or ADR) represents ownership in the shares of a foreign company trading on US financial markets. The stock of many non-US companies trades on US exchanges through the use of ADRs. ADRs enable US investors to buy shares in foreign companies without undertaking cross-border transactions. ADRs carry prices in US dollars, pay dividends in US dollars, and can be traded like the shares of US-based companies. For other uses, see Stock (disambiguation). ... An investor is any party that makes an investment. ...

Each ADR is issued by a US depositary bank and can represent a fraction of a share, a single share, or multiple shares of foreign stock. An owner of an ADR has the right to obtain the foreign stock it represents, but US investors usually find it more convenient simply to own the ADR. The price of an ADR is often close to the price of the foreign stock in its home market, adjusted for the ratio of ADRs to foreign company shares. In the case of companies incorporated in the United Kingdom, creation of ADRs attracts a 1.5% stamp duty reserve tax (SDRT) charge by the UK government. In relation to American Depositary Receipts (or ADRs), a Depositary bank is a U.S. bank that issues Depositary Receipts upon request from its local custodian bank in a foreign home stock market to issue ADRs representing a certain number of shares to be traded in an American stock market. ... Tax rates around the world Tax revenue as % of GDP Part of the Taxation series        In the United Kingdom, stamp duty is a form of tax charged on instruments (that is, written documents), and requires a physical stamp to be attached to or impressed upon the instrument in question. ...

Depository banks have numerous responsibilities to an ADR holder and to the non-US company the ADR represents. The first ADR was introduced by JPMorgan in 1927, for the British retailer Selfridges&Co. The largest depositary bank is the Bank of New York Mellon. The Bank of New York Mellon Corporation (NYSE: BK), is a global financial services company formed on 2 July 2007 as result of the merger of The Bank of New York and Mellon Financial Corporation. ...

Individual shares of a foreign corporation represented by an ADR are called American Depositary Shares (ADS).

Types of ADR programs

When a company establishes an American Depositary Receipt program, it must decide what exactly it wants out of the program and how much they are willing to commit. For this reason, there are different types of programs that a company can choose.

Unsponsored shares

Unsponsored shares are ADRs that trade on the over-the-counter (OTC) market. These shares have no regulatory reporting requirements and are issued in accordance with market demand. The foreign company has no formal agreement with a custodian bank and shares are often issued by more than one depositary. Each depositary handles only the shares it has issued.

Due to the hassle of unsponsored shares and hidden fees, they are rarely issued today. However, there are still some companies with outstanding unsponsored programs. In addition, there are companies that set up a sponsored program and require unsponsored shareholders to turn in their shares for the new sponsored. Often, unsponsored will be exchanged for Level I depositary receipts.

Over-the-counter (OTC) trading is to trade financial instruments such as stocks, bonds, commodities or derivatives directly between two parties. ...

Level I

Level 1 depositary receipts are the lowest sponsored shares that can be issued. When a company issues sponsored shares, it has one designated depositary acting as its transfer agent.

A majority of American depositary receipt programs currently trading are issued through a Level 1 program. This is the most convenient way for a foreign company to have its shares trade in the United States.

Level 1 shares can only be traded on the OTC market and the company has minimal reporting requirements with the U.S. Securities and Exchange Commission (SEC). The company is not required to issue quarterly or annual reports. It may still do so, but at its own discretion. If a company chooses to issue reports, it is not required to follow US generally accepted accounting principles (GAAP) standards and the report may show money denominations in foreign currency.

Companies with shares trading under a Level 1 program may decide to upgrade their share to a Level 2 or Level 3 program for better exposure in the U.S. markets.

The U.S. Securities and Exchange Commission, commonly referred to as the SEC, is the United States governing body which has primary responsibility for overseeing the regulation of the securities industry. ... The Securities and Exchange Commission (SEC) requires public companies to file reports regularly so that they can be made available to the public. ... Generally accepted accounting principles (GAAP) are the accounting rules used to prepare financial statements for publicly traded companies and many private companies in the United States. ...

Level II (listed)

Level 2 depositary receipt programs are more complicated for a foreign company. When a foreign company wants to set up a Level 2 program, it must file a registration statement with the SEC and is under SEC regulation. In addition, the company is required to file a Form 20-F annually. Form 20-F is the basic equivalent of an annual report (Form 10-K) for a U.S. company. In their filings, the company is required to follow GAAP standards.

The advantage that the company has by upgrading their program to Level 2 is that the shares can be listed on a U.S. stock exchange. These exchanges include the New York Stock Exchange (NYSE), NASDAQ, and the American Stock Exchange (AMEX).

While listed on these exchanges, the company must meet the exchange’s listing requirements. If it fails to do so, it will be delisted and forced to downgrade its ADR program.

The Securities and Exchange Commission (SEC) requires public companies to file reports regularly so that they can be made available to the public. ... The Securities and Exchange Commission (SEC) requires public companies to file reports regularly so that they can be made available to the public. ... The New York Stock Exchange (NYSE), nicknamed the Big Board, is a New York City-based stock exchange. ... NASDAQ in Times Square, New York City. ... The American Stock Exchange (AMEX) is an American stock exchange situated in New York. ... A stock exchange is a corporation or mutual organization which provides the facilities for stock brokers to trade company stocks and other securities. ...

Level III (offering)

A Level 3 depositary receipt program is the highest level a foreign company can have. Because of this distinction, the company is required to adhere to stricter rules that are similar to those followed by U.S. companies.

Setting up a Level 3 program means that the foreign company is not only taking some of its shares from its home market and depositing them to be traded in the U.S.; it is actually issuing shares to raise capital. In accordance with this offering, the company is required to file a Form F-1, which is the format for an Offering Prospectus for the shares. They also must file a Form 20-F annually and must adhere to GAAP standards. In addition, any material information given to shareholders in the home market, must be filed with the SEC through Form 8K.

Foreign companies with Level 3 programs will often issue materials that are more informative and are more accommodating to their U.S. shareholders because they rely on them for capital. Overall, foreign companies with a Level 3 program set up are the easiest on which to find information.

The Securities and Exchange Commission (SEC) requires public companies to file reports regularly so that they can be made available to the public. ... A prospectus is a legal document that institutions and businesses use to describe what they have to offer for participants and buyers. ... The Securities and Exchange Commission (SEC) requires public companies to file reports regularly so that they can be made available to the public. ...

Restricted programs

Foreign companies that want their stock to be limited to being traded by only certain individuals may set up a restricted program. There are two SEC rules that allow this type of issuance of shares in the U.S.: Rule 144-A and Regulation S. ADR programs operating under one of these 2 rules make up approximately 30% of all issued ADRs.

144-A

Some foreign companies will set up an ADR program under SEC Rule 144(a). This provision makes the issuance of shares a private placement. Shares of companies registered under Rule 144-A are restricted stock and may only be issued to or traded by Qualified Institutional Buyers (QIBs).

No regular shareholders will have anything to do with these shares and most are held exclusively through the Depository Trust & Clearing Corporation, so the public often has very little information on these companies.

144-A shares may be issued alongside of a Level 1 program.

Regulation S

The other way to restrict the trading of depositary shares is to issue them under the terms of SEC Regulation S. This regulation means that the shares are not and will not be registered with any United States securities regulation authority.

Regulation S shares cannot be held or traded by any “U.S. Person” as defined by SEC Regulation S rules. The shares are registered and issued to offshore, non-US residents.

Regulation S shares can be merged into a Level 1 program after the restriction period has expired.

It has been suggested that this article or section be merged with Securities Act of 1933. ... It has been suggested that Private Issue of Public Equity be merged into this article or section. ... The Depository Trust & Clearing Corporation (DTCC), based primarily at 55 Water Street in New York City, is the world’s largest post-trade financial services company. ... It has been suggested that this article or section be merged with Securities Act of 1933. ...

Sourcing ADRs

One can either source new ADRs by depositing the corresponding domestic shares of the company with the depositary bank that administers the ADR program or, instead, one can obtain existing ADRs in the secondary market. The latter can be achieved either by purchasing the ADRs on a US stock exchange or via purchasing the underlying domestic shares of the company on their primary exchange and then swapping them for ADRs; these swaps are called crossbook swaps and in many occasions account for the bulk of ADR secondary trading. This is especially true in the case of trading in ADRs of UK companies where creation of new ADRs attracts a 1.5% stamp duty reserve tax (SDRT) charge by the UK government; sourcing existing ADRs in the secondary market (either via crossbook swaps or on exchange) instead is not subject to SDRT.

Tax rates around the world Tax revenue as % of GDP Part of the Taxation series        In the United Kingdom, stamp duty is a form of tax charged on instruments (that is, written documents), and requires a physical stamp to be attached to or impressed upon the instrument in question. ...

See also

• Cross Listing
• Global Depository Receipt
• Non-voting depository receipts (NVDR)

Cross listing of Shares is when a firm lists its equity shares on one or more foreign stock exchange in addition to its domestic exchange. ... A Global Depository Receipt or Global Depositary Receipt (GDR) is a certificate issued by an international bank which can be subject of worldwide circulation on capital markets. ...

External links

• The Bank of New York Mellon's ADR website
• ADR.com (JPMorgan's ADR website)
• SEC guide to foreign investing for U.S. citizens(PDF)