Business Finance

Banking Institution

Referred to as universal or commercial bank can range from a large financial institution with a highly visible brand name and an international presence to a small organization with a local presence

Financial institution

otherwise known as banking Institution, are corporations that provide services as intermediaries of financial markets

Depository Institutions

Contractual Institutions

Investment Institutions

3 major types of financial institution

Depository Institutions

Deposit taking institution that accept and manage deposits and make loans, including banks, building societies, credit unions, trust companies and mortgage loan companies

Contractual Institutions

Insurance companies and pension funds

Investment Institutions

Investment banks, underwriters, brokerage firms

Commercial Banks

Cooperative Banks

Two categories of financial institution according to ownership structure

Nonbank Financial Institution

A financial institution that does not have a full banking licence and cannot accept deposits from the public

Risk pooling institution

Insurance companies underwrite economic risk associated with death, illness, damage to or loss of property, and risk of loss. They provide a contingent promise of economic protection in the case of loss.

Life insurance

General Insurance

Two type of insurance companies

Contractual savings institution

(also called institutional investors) provide the opportunity for individuals to invest in collective investment vehicles in a fiduciary rather than a principle role

Other nonbank Financial Institutions

Market makers are broker-dealer institution that quote both a buy and sell price for an asset held in inventory

Government Non-Bank Financial Institutions

Insurance for workers under the Government Services Insurance System was in operation by 1936

These Institutions were created essentially to protect the welfare of employees

Among these are Institutions like PAG-IBIG

Investment Houses

These are stock corporations engaged in the underwriting of securities of other corporations on a guaranteed basis.

Financing Companies

For the purpose of extending credit facilities to consumers and to industrial, commercial, or agricultural enterprise

Investment Companies

Any issuer which the Commission upon application by such issuer finds and by order declares to be primarily engaged in a business or businesses other than that of investing reinvesting or trading in securities either directly or (A) through majority-owned subsidiaries or (B) through controlled companies conducting similar types of business

Securities Dealer and Brokers

A securities dealer buys and sells shares of stock of another or acquires securities for profit.

A securities broker facilities transaction between a buyer and seller of securities for a commission

Venture Capital Corporations

These are organized jointly by private banks the National Development Corporation and the Technology Livelihood Research Center and/or other government agencies to develop promote and assist small and medium scale enterprise through debt to equity financing

Pawnshops

Provide credit to small borrowers who are not qualified to obtain small loans from other financial institution

Lending Investors

Are those who make a practice of lending money for themselves or other. They extend all types of loans generally short term often without collateral using their own capital

Mutual Building and Loan Association

These are corporations whose capital stock must be subscribed by the stockholders in regular equal installments with the purpose of accumulating the stockholders' savings and repaying them with their accumulate savings

Bank Loan Requirements

Purpose of Loan

Business Experience

Business Plan

Credit History

Personal Information

Financial Statements

Collateral

Cash Flow

Bank Loan Requirements

Purpose of loan

While some lenders don't have usage restrictions most will want to know how you plan to spend it

Business Experience

When reviewing your loan application banks will consider how much experience you have

Business Plan

You might be asked to submit your business plan. It might seems tedious, but your business plan can help the bank determine the right loan amount and term for you

Credit History

A bank will conduct a credit check. They'll do this to determine your personal and business credit scores

Personal Information

Even though you'll be borrowing money for your business some personal Information could affect to qualify. Your personal credit score will affect your eligibility

Financial Statements

Most banks will require a balance sheet, profit and loss statements, cash flow statements, income statementsz and other financial projections

Collateral

Business or personal property that you put up to guarantee the repayment of a loan

Cash Flow

Does your business generate enough cash flow to repay a bank loan on-time?

Demographics

Includes the name or business name, birthdate, address, SSS no, phone number and other identifying information

Income or revenue

Refers to current personal income and employer, employment and salary history, and business revenue

Asset and Liabilities

Applicants may ask to disclose their checking savings and investment accounts and their outstanding loans and credit cards

Contact or reference

Require identification and contact information of existing employers previous employers or even nearest relative not living with the identified contact

Character, Capacity, Collateral, Capital, Condition

5Cs