types of securities in banking
Many investors around the world earn money by investing in bank securities. Someone quite familiar with this area, and for some bank securities market remains a mystery. The purpose of this article - to familiarize you with the types of securities booms.
Before we begin our discussion, let's see what kind of definition provides a security law. «Security - a document certifying compliance with the prescribed form and the mandatory details of property rights, the exercise or transfer shall be possible only upon its presentation." Hence, security - this is a document. In this case, a document that is valid only upon its presentation.
At the moment, are the following types of existing securities:
- Bonds
- Notes
- Cheques
- Certificates
- Banking book
- Promotions
Most types of securities, usually drawn on standard forms of strict accountability. They must contain the appropriate laws required details, which include such as:
- The name of the security;
- Date of registration of the security (deposit money);
- Full name and address of the legal entity - the issuer;
- The nominal value of the security;
- The name of the owner, only registered securities;
- The time of payment;
- Type of yield securities - interest that specify the interest rate and the amount of interest due, discount, interest free.
- More details, depending on the type and purpose of the security.
Now we give the definition of each type of security.
Bond - this is a security which is a debt obligation issued by the state or the company under certain conditions with the release of the home loan and gives its holder (owner) income in the form of a fixed percentage of its face value.
Bill - this is a security certifying the unconditional cash unilateral debt obligation of the issuer (the bank) to pay when due a certain amount of money note holder (owner of the notes). Bank bill basically has the nature of the deposit, and is issued by the bank - the issuer of the client on the basis of the deposit in the bank a certain amount of funds.
Check - is a security containing an unconditional order to pay the bank drawer of the check amount to the check holder.
Certificate of deposit - is a security certifying the amount of the contribution made to the bank, and the rights of the depositor (certificate holder) to receive, at maturity, the principal and interest due on the certificate in the bank that issued the certificate, or in any branch of the bank.
Action - is a security, issued a joint stock company and consolidate the right of the owner (shareholder) to receive part of the profits of the company in the form of dividends, to participate in the management of the company and part of the property remaining after its liquidation.
I hope this article will help you to have an idea about the types of bank securities.
