Numbers in the business world is an ever changing variable. Starting up business does not directly mean success. Sometimes it goes up, sometimes it goes down. Businesses, your business works on it; banks will welcome it with open arms. In an information-hungry age, time passes faster than you think. Knowing how the system works to your advantage both as an early-warning system as well as knowing to navigate in its world of terms and jargon.
To be clear, there is no such thing as a perfect bank. There are exceptional ones, but they also have their mismanagements and false promises to lump in with the rest of them. Telling everybody you’re the best bank is not enough for the bankable population of the world. There are standards in place to make a bank a worthy place to keep your money safe, but what makes your money truly safe understands how a bank works, how taxes are applied and how money is recorded.
This is perhaps a safer bet when choosing your banks aside from searching or online survey. Third party or independent agencies make such choices easier, but understanding the concept of banking must be understood in order for the rating systems to make sense to you. Why the need for independent companies to rate banks? Because they’re unbiased, making their opinions valid rather than banks trying to sell themselves to you, the consumer. Although auditing firms like the Big Western Six have a habit of posting their audit reports to the general public and have a wide array of banks that are under them, business proposal in other way, it always works to get a second opinion on the bank you’re going to trust your money with.
The problem with these rating systems is there doesn’t seem to be a general consensus on how they rate banks from one another. It’s not simple as following a four out of five rating right off the bat; since these independent firms use different computations and base their data on differing basis.
A good bank is usually backed or accredited by international bank agencies since these agencies have a set of requirements and or standards to keep the quality of the bank positive. Although these agencies usually just reinforce standards, they keep the quality and integrity of service up to spar with standards rather than just give positive feedback for glossy brochures.
The problem here is that some business that look at the bank’s figures at the end, but rarely the process how the figures are, well, figured. Financial profiles are more than just skimming down to the big black numbers written in bold.
Exchanges rates are a mucky issue when it comes to financial statements. Since they’re basically calculated according to the December 31st of the fiscal year, some countries with a slightly turbulent domestic currency might find this a little too confusing. It’s more than just the financial statements they release and what you can find at the bottom of it, what you earn and you lose depends on the turbulent status of the following days, not on a particular end of the month.
Like it or not, banks are essentially riding on risks. Time is important. It’s essentially like making a calculated guess on how the market will perform and best ride the ride tide. This is essentially reading a weather forecast, there are algorithms in place to calculate the highs and lows of the stock market so it is not just a building where you keep your money locked up, it’s a place where money is lost and gained like currents. If your banks tells you different and they claim they never had reclassifications, recoveries or even charge offs, they’re not exactly an honest bank.
Banks as They Are
Banking is essentially a business unto its own self. It’s a business of lending since it bases its survival on it for the most part. They may provide insurances for their costumers. They require scrupulous histories and getting on the right type of market to see their way through – financial analysts would help to get a clear picture on this. Just imagine a place where people put their money and borrow money from, and picture the management as a person that has to consciously decide which horse he will bet on. Bet on the losing horse and the bank loses other people’s money, money coupons, which may not affect the people’s current standings but will harm the bank since they have to fill what they lose from their own pockets. Win big and the bank wins big; plain and simple.