Wealth management is a comprehensive set of financial services designed to help individuals and families manage their wealth, protect their assets, and grow their net worth over time. It typically involves the coordination of various financial professionals, such as investment managers, financial advisers, tax professionals, and estate planners, to help clients achieve their financial goals and objectives.
A bank bail-in is a financial rescue procedure in which a failing bank’s creditors and depositors are forced to bear some of the losses incurred by the bank rather than taxpayers or the government. This means that if a bank is in danger of failing, it will use its own funds to recapitalise itself rather than rely on external funding.
Common Equity Tier 1 (CET1) capital ratio is a measure of a bank’s financial strength and ability to withstand financial stress. It is one of the components of the Basel III capital framework, which is a set of international standards for bank capital adequacy, stress testing, and liquidity risk management.
Discount window borrowing is a lending facility a central bank provides to commercial banks that need short-term funding to meet their liquidity needs. The discount window is a tool that allows banks to borrow money directly from the central bank, typically at a discount rate that is lower than the prevailing market rate.
Fractional reserve banking (FRB) is a regulatory system in which banks hold at least a specific fraction of their customers’ deposits in reserve and lend out the rest. When a bank accepts customer deposits, it must keep a certain percentage of those deposits in reserve, typically held at that country’s central bank.
An Exchange-Traded Fund (ETF) is an investment security that combines the features of both mutual funds and stocks. Like mutual funds, ETFs pool money from a group of investors to buy a basket of assets or securities, such as stocks, bonds, or commodities. However, unlike mutual funds, ETFs trade on an exchange, similar to individual stocks.
