If you represent Company c, look at the following instructions.

Company C: Your company is becoming very cost conscious. You have been through Bank B’s charges with your boss, and he wants you to reduce them overall by at least 10%. See what you can do.

Negotiate in accordance with your instructions.

What factors are important for the financial success of a bank operating internationally? Look through the list of factors below and when you have decided on their relative order of importance, write the number of your choice in column A. Number 1 should show the factor which you consider most important and number 10 the least. You will be told how to fill in column B.

	A	B
Use of advanced technology
Strong national economy
Skilled and efficient staff
Wide range of high quality products
Broad network of correspondent banks
Good management
Wide geographical spread of local representation
Good market reputation
Established and diverse customer base
Other (specify)

XIV. Choose words to complete each sentence. In some cases there is more than one possibility.

1. The Bank of England fixes a minimum interest rate, called the discount rate, at which it makes secured loans to .......... .

a) big companies b) private individuals c) commercial banks d) new businesses

2. British commercial banks lend to blue-chip borrowers (big, secure companies) at the ........... . The American equivalent is the prime rate.

a) base rate b) basic rate c) discount rate d) market rate

3. All other borrowers pay more, depending on the lender's estimation of their present and future solvency, also known as their creditworthiness or ........... or ........... .

a) credit b) creditors c) credit standing d) credit rating

4. Borrowers can usually get a ........... interest rate if the loan is guaranteed by securities or other collateral.

a) higher b) long-term c) lower d) riskier

5. Banks make their profits from the difference between the interest rate charged to borrowers and that paid to depositors, also known as a ........... or ........... .

a) margin b) mistake c) range d) spread

6. Long-term interest rates are generally higher than short-term ones, except when the central bank temporarily reduces the money supply i.e. makes money ........... or ........... .

a) loose b) scarce c) tight d) uncommon

7. These days many loans are made with ........... or variable interest rates that change according to the supply and demand for money.

a) drowning b) floating c) sinking d) swimming

8. Borrowers and lenders can sometimes arrange limits beyond which rates cannot move. The upper limit is called a ........... or a ........... .

a) cap b) ceiling c) roof d) summit

9. The lower limit on a variable rate loan is known as a ........... .

a) bottom b) carpet c) floor d) maturity

10. A ........... is an arrangement that fixes both the upper and lower limits.

a) collar b) tie c) shirt d) suit

11. Central banks cannot determine the minimum lending rate for so-called Eurocurrencies - currencies held ........... .

a) outside their country of origin b) in Europe

12. Banks are able to offer better rates to borrowers of Eurocurrencies because there are no ........... imposed by the central bank.

a) discount rates b) maturities c) money supplies d) reserve requirements