Money Laundering.

BACH, Step in Money Laundering, Core Capital/Tier 1 capital, Bond, Call option, A financial intermediary, Investment companies, Stress testing, Risk-weighted asset, Risk Premium, National Payment Switch Bangladesh (NPSB), Core Risk, Why Prevention of Money Laundering is necessary, Portfolio management, Loan classification, Loan provision, Bank Rate, Repo, Reverse Repo, CAMELS, Type of Loan

Bangladesh Automated Clearing House: Bangladesh Automated Clearing House (BACH): BACH, the first ever electronic clearing house of Bangladesh, has two components - the Automated Cheque Processing System (ACPS) and the Electronic Funds Transfer (EFT). Both the systems operate in batch processing mode- transactions received from the banks during the day are processed at a pre-fixed time and settled through a single multilateral netting figure on each individual bank's respective books maintained with the Bangladesh Bank. A state-of-the-art Data Center (DC) and a Disaster Recovery Site (DRS) have been established comprising of most modern software and hardware for dealing with the operations of BACH. A Virtual Private Network (VPN) has been created between the participating commercial banks and Data Center (DC) & Disaster Recovery Site (DRS) for communicating necessary information related to BACH. Digital Certificate has been formulated for the first time in Bangladesh for secured data communication.

Step in Money Laundering: Placement (money laundering, currency exchange, Securities brokerage, fund mixture, land purchage), Layering and Integration (property dealing, fake import or export).

Core Capital/Tier 1 capital: Core capital is the minimum amount of capital. 

Core Capital (Tier 1 Capital):

01) Paid up capital / capital deposited with BB

02) Share premium,03) Statutory reserve

04) General reserve,05) Retained earning

06) Minority Interest in subsidiaries

07) Non-Cumulative irredeemable preference shares

08) Dividend equalization account.

Call option: 

A call option is an agreement that gives an investor the right, but not the obligation, to buy a stock, bond, commodity  or other instrument at a specified price within a specific time period.

Bond: 

A bond is a debt investment in which an investor loans money to an entity (typically corporate or governmental) which borrows the funds for a defined period of time at a variable or fixed interest rate. Bonds are used by companies, municipalities, states and sovereign governments to raise money and finance a variety of projects and activities. Owners of bonds are debtholders, or creditors, of the issuer.

Characteristics of Bonds

• Most bonds share some common basic characteristics including:

• Face value is the money amount the bond will be worth at its maturity, and is also the reference amount the bond issuer uses when calculating interest payments.

• Coupon rate is the rate of interest the bond issuer will pay on the face value of the bond, expressed as a percentage.

• Coupon dates are the dates on which the bond issuer will make interest payments. Typical intervals are annual or semi-annual coupon paymets.

• Maturity date is the date on which the bond will mature and the bond issuer will pay the bond holder the face value of the bond.

Issue price is the price at which the bond issuer originally sells the bonds.

A financial intermediary is an entity that acts as the middleman between two parties in a financial transaction, such as a commercial bank, investment banks, mutual funds and pension funds. Financial intermediaries offer a number of benefits to the average consumer, including safety, liquidity, and economies of scale involved in commercial banking, investment banking and asset management. Although in certain areas, such as investing, advances in technology threaten to eliminate the financial intermediary, disintermediation is much less of a threat in other areas of finance, including banking and insurance.

Investment companies are business entities, both privately and publicly owned, that manage, sell, and market funds to the public. They typically offer investors a variety of funds and investment services, which include portfolio management, recordkeeping, custodial, legal, accounting and tax management services.

Core Risk:

01) Credit Risk

02) Foreign Exchange Risk

03) Asset – Liability management risk

04) Money laundering prevention risk

05) Internal control and compliance risk

06) Information and Communication Technology risk.

Stress Testing: 

A bank stress test is an analysis conducted under unfavorable economic scenarios designed to determine whether a bank has enough capital to withstand the impact of adverse developments. Banks with $50 billion in assets are required to do internal stress tests by their own risk management team and also stress tests from the Federal Reserve.Stress tests focus on a few key risks, such as credit risk, market risk and liquidity risk, to banks' financial health in crisis situations. Hypothetical crises are determined using various factors from the Federal Reserve and International Monetary Fund (IMF). Bank stress tests were put in place and became more widespread after the 2007-2009 global financial crisis, the worst since the Great Depression. This crisis left many banks and financial institutions severely undercapitalized, which the stress tests aim to prevent.

Risk-weighted asset Risk-weighted assets are used to determine the minimum amount of capital that must be held by banks and other institutions to reduce the risk of insolvency. The capital requirement is based on a risk assessment for each type of bank asset. For example, a loan that is secured by a letter of credit is considered to be riskier and requires more capital than a mortgage loan that is secured with collateral.

A risk premium is the return in excess of the risk-free rate of return an investment is expected to yield; an asset's risk premium is a form of compensation for investors who tolerate the extra risk, compared to that of a risk-free asset, in a given investment. For example, high-quality corporate bonds issued by established corporations earning large profits have very little risk of default. Therefore, such bonds pay a lower interest rate, or yield, than bonds issued by less-established companies with uncertain profitability and relatively higher default risk.

National Payment Switch Bangladesh (NPSB) is an electronic platform, started its operation on 27 December 2012. The core objective behind implementation of NPSB is to attain interoperability in retail banking transactions originating from different electronic delivery channels e.g. Automated Teller Machines (ATM), Point of Sales (POS), internet, mobile applications etc. Moreover, the switch is also a stimulus to boost up cashless and electronic payments all over the country.At present, 51 banks are in operation for interbank ATM transactions among which 46 banks are also in operation for interbank POS transactions through NPSB. The following types of ATM and POS transactions are presently live through NPSB:

• ATM channel is accommodating Balance Inquiry, Mini Statement, Cash Withdrawal transactions.

• POS is accommodating Retail Purchase transaction.

Bangladesh Bank is also looking forward to gradually accommodating the transaction scopes mentioned below under NPSB that depends on the readiness of commercial banks:

• Over the counter (OTC through POS) Standing Order 

• ATM: Interbank Fund Transfer, Bill Payment, Interbank Cash Deposit 

• POS: Interbank Cash Withdrawal, Bill Payment 

• Kiosk: Interbank Fund Transfer, Mini Statement, Balance Enquiry, Bill Payment 

• m-Commerce (App based Mobile Banking) : Interbank Fund Transfer, Bill Payment, Retail Purchase 

• e-Commerce: Bill Payment, Retail Purchase.

Why Prevention of Money Laundering is necessary?

Money laundering allows terrorists and criminals to undertake various activities like:

1. Drug trafficking

2. Financing terrorist activities

3. Evasion of exchange regulations

4. Evasion of taxation rules

5. Making blackmail payments

6. Paying ransom for kidnapping.

7. Dealing of arms and ammunitions

Portfolio management is the art and science of making decisions about investment mix and policy, matching investments to objectives, asset allocation for individuals and institutions, and balancing risk against performance. Portfolio management is all about determining strengths, weaknesses, opportunities and threats in the choice of debt vs. equity, domestic vs. international, growth vs. safety, and many other trade-offs encountered in the attempt to maximize return at a given appetite for risk.

Loan Classification:

5 categories

1. standard – due for less than 2 months

2. SMA: Above 2 month

3. Substandard – due for 3 months or more but less than 6 month

4. Doubtful – due for 6 months or more but less than 9 month

5. Bad and Loss – due for more than 9 month

Loan Provision: It is of two types General & Specific. Now general provision is 1% (with some variation like for SME 0.25&) and Specific provision is now as follows:

For Sub Standard = 20%

For Doubtful       = 50% & 

For Bad/Loss      = 100%

Repo (Repurchase) rate is the rate at which the central bank lends shot-term money to the banks against securities. When the repo rate increases borrowing from Central Bank becomes more expensive.  Therefore, we can say that in case, BB wants to make it more expensive for the banks to borrow money, it increases the repo rate; similarly, if it wants to make it cheaper for banks to borrow money, it reduces the repo rate.

Reverse Repo rate is the rate at which banks park their short-term excess liquidity with the BB.  The banks use this tool when they feel that they are stuck with excess funds and are not able to invest anywhere for reasonable returns. An increase in the reverse repo rate means that the BB is ready to borrow money from the banks at a higher rate of interest. As a result, banks would prefer to keep more and more surplus funds with RBI.

Repo vs Reverse Repo: 

we can conclude that Repo Rate signifies the rate at which liquidity is injected in the banking system by RBI, whereas Reverse repo rate signifies the rate at which the central bank absorbs liquidity from the banks

Loan generally of 4 types

1. Continuous Loan like Cash credit, overdraft

2. Demand Loan

3. Fixed Term Loan

Short term Agriculture & Micro Credit.

Bank Rate: 

This is the rate at which central bank lends money to other banks or financial institutions.  If the bank rate goes up, long-term interest rates also tend to move up, and vice-versa. Thus, it can said that in case bank rate  is hiked, in all likelihood banks will hikes their own lending rates to ensure that they continue to make profit

CAMELS Rating: Bangladesh Bank analyses Capital, Asset, Management, Earning, Liquidity and Sensitivity to Market Risk and does CAMELS rating and accordingly rank the Bank under 

1) Strong 

2) Satisfactory

3) Fair

4) Marginal & 

5) Unsatisfactory. 

BB sends this report to respective Bank and the Bank will present it in the Board Meeting and the Board will provide the guideline based on this report. If there is bad position in any single indicator or point is below 3 in total rating then BB will give EWS (Early Warning System) and try to develop the condition. If the rating is Marginal or Unsatisfactory or there is no development in EWS then BB declares the Bank a Problem Bank. If the Bank is a Problem Bank then BB imposes some injection with dense supervision. Now BB does it twice in a year.

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Provisioning- The Weapon Of The Financial Institutions.

There is a direct correlation of profit loss in business with provision of preservation. The financial statement of the business is prepared every year at a particular time. On the date on which the accounting statement is prepared, some issues remain uncertain. There may be some costs that will need to be paid in the near future, but the time or quantity of payment is not guaranteed right now. For example, a profit bonus will be given to the employees of a portion of net profits of the year 31 December 2017. It will be 5% of the net profit or 7% will be fixed later. In this case, profit bonus protection is preserved. Provisioning means that the expenditure will be made in the future, showing the amount of profit (right) shown in the cost of this year, so that the future cost should not be reduced to the extent of profit.

Provisioning is a program of modern accounting where some part of the profit is removed so that any liability that will be spent on future money or resources is paid. The institution can not figure out the exact amount or the exact duration of the future or the amount of time spent on it, but the institution will be fair about the cost.

For example, provision is made for income tax. The institution knows that after a few days income tax is to be given, it is not yet certain how much to pay, as the tax or tax sector may change. Banks have made provisions based on loan classification. The institution knows that it can not be possible to recover some debts, but it is not possible to ensure that the amount of debt will be unrealized. Since the bank will face losses in the future if the debt is not inadequate, it is showing low interest rates this year by showing that the loans will be unpredictable so that in the future the profits will not be reduced very much. The customer's compensation case against the organization is ongoing. With the possibility of losing the organization in the case, the provision will be preserved by showing this as the cost of financing this year so that the profits of the business will not suddenly get reduced in the future when paying the customer.

If the provision of this year is more than last year's provisional provision, the cost of this year will increase (profit will decrease). Likewise, if the provision of this year is less than last year's provisional provision, the cost of this year will be reduced or the profit will increase. Therefore, it is possible to make profit smoothing more than the amount of probation. In 1998, the International Accounting Standards Organization (IAB) published the calculation standard for provisioning which has been followed by most of the world including Bangladesh since 1999.

In accordance with international accounting standards, three conditions must be met for preservation. 1st Condition: There is no liability for any of the events in the past. Behavioral liability will mean liability which is not legally bound to be done by the institution, but it is practiced according to the rules of the long run, such as profit bonus payment. Provision can not be saved for any work that will happen in the future. For example, a buyer will be selling the goods in the balance, which he can not pay; Provision can not be saved in this case. 2nd condition: It is fairly sure that the event will cost some of the organization. If the customer is sued against the organization, then the provision can not be saved until the matter is fully confirmed that the institution will lose the case. 3rd condition: In any event, the cost of the organization can be easily estimated.

Provision can not be saved in some cases below-

1. The provision of this year will not be preserved for the loss of the organization in the next year. As the incident happens in the future, the 1st condition has been violated.

2. The machinery will be repaired for the next year so that the provision can not be saved this year. Because the company is not legally obliged to repair the machine (1st condition).

3. The government has sued the organization to harm the environment. The provision can not be preserved because of not having the right hold on how much compensation can be made. (Anwar Parvez, ACCA)

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Asset Liability Management

Definition of ALM (Asset Liability management ) and ALCO (Asset Liability Committee).

ALM:

Asset Liability Management (ALM) can be defined as a mechanism to address the risk faced by a bank due to a mismatch between assets and liabilities either due to liquidity or changes in interest rates. Liquidity is an institution’s ability to meet its liabilities either by borrowing or converting assets. Apart from liquidity, a bank may also have a mismatch due to changes in interest rates as banks typically tend to borrow short term (fixed or floating) and lend long term (fixed or floating).

A comprehensive ALM policy framework focuses on bank profitability and long term viability by targeting the net interest margin (NIM) ratio and Net Economic Value (NEV), subject to balance sheet constraints. Significant among these constraints are maintaining credit quality, meeting liquidity needs and obtaining sufficient capital.

ALCO:

Asset Liability Management (ALM) is an integral part of Bank Management; and so, it is essential to have a structured and systematic process for manage the Balance Sheet. Committee comprising of the senior management of the bank to make important decisions related to the Balance Sheet of the Bank (asset-Liability). The committee typically called the Asset Liability Committee (ALCO).

As per central bank guideline, the committee consists of the following key personnel of a bank:

- Chief Executive Officer / Managing Director

- Head of Treasury / Central Accounts Department

- Head of Finance

- Head of Corporate Banking

- Head of Consumer Banking

- Head of Credit

- Chief Operating Officer / Head of Operations

The committee calls for a meeting once every month to set and review strategies.

The key roles and responsibilities of the ALM Desk.

1) To assume overall responsibilities of Money Market activities.

2) To manage liquidity and interest rate risk of the bank.

3) To comply with the local central bank regulations in respect of bank’s statutory obligations as well as thorough understanding of the risk elements involved with the business.

4) Understanding of the market dynamics i.e competition, potential target markets etc.

5) Provide inputs to the Treasurer regarding market views and update the balance sheet movement.

6) Deal within the dealer’s authorized limit.

Description of "absence of good/effective ALM of a bank may lead it to different crisis jeopardizing image and foundation of the bank?"

In banking, asset liability management is the practice of managing the risks that arise due to mismatches between the assets and liabilities (debts and assets) of the bank. Banks face several risks such as liquidity risk, interest rate risk, credit and operational risk. Asset/Liability management (ALM) is a strategic management tool to manage Asset, Liability, spread of interest rate and liquidity risk faced by banks & Financial Institutions.

In absence of good/effective ALM of a bank may lead it to following crisis:

Liquidity risk:

the current and prospective risk arising when the bank is unable to meet its obligations as they come due without adversely affecting the bank's financial conditions.

Interest rate risk:

The risk of losses resulting from movements in interest rates and their impact on future cash-flows. One of the primary causes are mismatches in terms of bank deposits and loans.

Currency risk management:

The risk of losses resulting from movements in exchanges rates. To the extent that cash-flow assets and liabilities are denominated in different currencies.

Funding and capital management:

As all the mechanism to ensure the maintenance of adequate capital on a continuous basis. (Usually a prospective time-horizon of 2 years).

Profit planning and growth:
Profit planning is required to make a sufficient growth for the organization itself.

In addition, ALM deals with aspects related to credit risk as this function is also to manage the impact of the entire credit portfolio (including cash, investments, and loans) on the balance sheet. The credit risk, specifically in the loan portfolio, is handled by a separate risk management function and represents one of the main data contributors to the ALM team.

Ending words :

So, it can be said undoubtedly that absence of good/effective ALM of a bank may lead it to different crisis jeopardizing image and foundation of the bank.

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Cyber Insurance: The New Arrival Into IT World For Cyber Attack Protection.

General words of Cyber Insurance

Technological advancements have revolutionized the way online notices, advertisements, advancements, and shopping are finished. This has conveyed enormous advantages to organizations, who have now discovered better approaches to connect with the current and potential purchasers. The open door offered by online networking alone is rich for organizations that expect to lead comprehensive showcasing exercises. Nonetheless, online networking stages have additionally moved toward becoming roads of cyber-attacks. This has fashioned untold monetary misfortunes to a wide range of organizations – little, medium and huge. A valid example is the most recent assault from "wanna-cry'', a payment product that influenced organizations on a worldwide scale. Cyber-attacks can begin from anyplace. Organizations vast and little must be watchful and this is why it should hold a Cyber Insurance policy.

There are various ways that organizations can respond to the risk of cyber attacks with a specific end goal to ensure themselves and their customers. A few dangers are avoidable through the legitimate use of approaches like requiring solid passwords. Others may require further developed programming and checking. In any case, in any case, on the off chance that you manage customers on the web, or on the off chance that you keep vital individual data, you likely need cyber protection.

Cyber Insurance

Cyber insurance is an insurance item used to shield organizations and individual clients from Internet-based risks, and all the more by and large from risks identifying with data technology foundation and exercises. Risks of this nature are ordinarily rejected from conventional commercial general obligation approaches or if nothing else are not particularly characterized in customary insurance items. Coverage gave by cyber-insurance strategies may incorporate first-party coverage against misfortunes, for example, information demolition, blackmail, burglary, hacking, and dissent of administration assaults; risk coverage repaying organizations for misfortunes to others caused, for instance, by blunders and exclusions, inability to defend information, or slander; and different advantages including standard security-audit, post-episode advertising and investigative costs, and criminal reward funds. Cyber Insurance as a Way to Protect Your Data from Hacker Attacks

Types of Cyber Insurance

Cyber insurance is a risk management technique via which network user risks are transferred to an insurance company, in return for a fee, i.e., the insurance premium. Examples of potential cyber-insurers might include ISP, cloud provider, traditional insurance organizations. Proponents of cyber-insurance believe that cyber-insurance would lead to the design of insurance contracts that would shift appropriate amounts of self-defense liability to the clients, thereby making the cyberspace more robust. Here the term ‘self-defense' implies the efforts by a network user to secure their system through technical solutions such as anti-virus and anti-spam software, firewalls, using secure operating systems, etc. There are various types of cyber insurance-

Extortion:

Provides coverage for the expenses and costs related to the investigation of threats to commit cyber attacks against the policyholder's frameworks and for installments to scoundrels who debilitate to get and unveil delicate data.

Reputation Insurance:

Insurance against notoriety attacks and cyber defamation maligning.

Forensic investigation:

Covers the legitimate, specialized or legal administrations important to survey whether a cyber assault has happened, to evaluate the effect of the assault and to stop an assault or attack.

Business interruption:

Covers lost wage and related costs where a policyholder can't lead business due to a cyber event or information or data loss.

Computer data loss and restoration:

Covers physical harm to, or loss of utilization of, computer-related assets and resources, including the costs of recovering, restoring and reestablishing information or data, hardware, software or other information destroyed or damaged as the result of a cyber attack also.

Hacks range:

Insurance against cyber attacks and hacking attacks.

Theft and fraud:

Spreads obliteration or loss of the policyholder's information as the aftereffect of a criminal or deceitful cyber occasion, including robbery, transfer of the fund and exchange of assets.

To read more... Insurance and its types or categories.

Role of Cyber Insurance Providers

Cyber insurance Protection is an insurance set up that's meant to supply protection in the event of a cyber-attack. Firms face large losses and expenses within the event of a cyber-attack and also the cyber insurance set up is supposed to mitigate such eventualities. The idea of cyber insurance has fully grown enormously since 2005. It's projected to succeed in near to $8 billion in premiums inside future 3 some years.

Several firms within the USA have accomplished the necessity for finance in a very cyber insurance. Presently, near to thirty-fifth people businesses have non-inheritable cyber insurance policies of some kind, and their variety is growing daily.
The cyber insurance business is evolving at a wide-ranging rate. However, the magnitude of the cyber-attacks threat has not been totally appreciated for a handful of reasons.

First, several firms fail to report the complete extent of the damages they face from cyber-attacks for concern of negative packaging also.

Second, the character of cyber-attacks is usually dynamical. The 2 reasons straddle underwriters with a challenge on a way to worth the money impact of an attack.

Generally, a cyber-insurance policy can cowl the subsequent expenses:

1. Forensics Examination

Once an attack happens, it is crucial that a forensic examination is directed. The examination will uncover the full degree of the harm and what should we do to redress the circumstance. The forensic analysts will prompt the company on what should they do to effectively deflect or withstand any future cyber-attack threats.

2. Costs Arising from Lawsuits and Extortion

The policy will provide food for costs that emerge from claims favored against the company. A break of customer secrecy by a cyber-attack might occasion such claims. The policy additionally covers any statutory fines that might be forced on the business, the cost of lawful arrangements and any expenses caused because of cyber blackmail.

3. Administration Losses

The cyber insurance policy will meet the cost of misfortune because of disappointment by the company to convey benefit due to the cyber-attack. The administration interference might be because of network downtime or something else. Other administration costs that are secured by the cyber-insurance policy incorporate those of recuperating any lost data and completing the important PR exercises to repair the company's imprinted picture.

4. Data Alerts

The policy provides food for data cautions to clients following a rupture. This likewise incorporates checking the FICO assessment of clients whose qualifications and character may have been traded off amid the strike.

5. Others:

Some of the kinds of loss a company may experience during a cyber breach are:

• Costs of remediation, including the cost to improve security and prevent a similar breach going forward.
• The cost of customer breach notification, including legal costs and public relations.
• Expenses of customer compensation, including credit monitoring, service-level agreement penalties, refunds and contractual breaches.
• Costs of liability associated with the breach, including legal costs.
• Direct monetary loss through electronic theft.
• Losses due to extortion from DDoS blackmail or ransomware.
• Costs of mitigating and investigating the incident.
• Losses due to downtime.
• Losses from damage to data and systems, and the costs associated with restoring systems back to normal.

What do you look for in Cyber-insurance Coverage?

Various cyber insurance companies offer a rundown of things covered by their insurance policy. The purchaser can utilize these rundowns to thoroughly analyze different suppliers previously they settle on the one they see to be most open to their necessities. You can likewise use a free insurance office to enable you to look for the best esteem. For instance, since we are free, we can shop with numerous bearers for a wide range of insurance needs. Whatever the case, you should get some information about the accompanying parts of a cyber-insurance design:

A.

Does the backup plan redo the insurance coverage want to the requirements of their customers, or does it offer a one-measure fits-all sort of policy? Obviously, as the purchaser, an insurance firm will inspire you more that will tweak their items for your firm.

B.

How do deductibles look at among the different backup plans? Make sure to look into deductibles among different insurance suppliers to decide the ones with the best arrangements also.

C.

Does the insurance policy incorporate coverage for outsider suppliers? What are the cutoff points? On the off chance that outsider suppliers have cyber-insurance, by what means will this impact the terms of my agreement?

D.

Do the insurance policy cover APTs (Advanced Persistent Threats) and other system assaults?

E.

Does the insurance policy offer assurance in case of a strike? The strikes could focus on the organization, or the inadvertent blow-back might influence the organization. How does the safety net provider propose to deal with this?

F.

Does the safety net provider offer E&O assurance that caters for a damaging activity done unintentionally by a representative?

G.

For to what extent will the policy offer assurance against the danger of APTs?

To read more articles... Principles of Insurance.

How Do Insurance Companies Determine Insurance Coverage?

A cyber attack insurance provider anticipates that potential customers will have set up specific measures previously they can guarantee them. For instance, the purchaser must guarantee that they have completed a hazard assessment and made a point by point cyber chance profile. They additionally should have strong securities against potential cyber-assaults. The safety net provider will ask for that the purchaser teaches its workforce on the best security practices to counteract, control, or effectively withstand a cyber-assault.

The purchaser urge to counsel moral programmers with a view to getting an understanding on the purchaser's most helpless spots and how to ensure them also.

Cyber insurance purchasers might be solicited to give a nitty gritty review of their organization's methodology and practices. This will be to empower the backup plan to evaluate the helplessness levels of the organization. Back up plans may solicit companies to change a few perspectives from their regulatory practices in the event that they esteem to a danger.

Importance of Cyber Insurance Coverage for Businesses

Companies that in part or completely direct their organizations over the web need to contact a legitimate backup plan for a cyber-assault insurance policy also. This is on the grounds that such organizations stand the most serious danger struck and lose their benefits also. Measurements plainly demonstrate that cyber-assaults are in an upward direction.

A stunning perception: Assaulters are assaulting the private companies at a higher recurrence than anticipated. For instance, a report by two driving web security suppliers found that around 30% of the cyber-assaults recorded 2 years prior focused independent ventures. Shockingly, the assaults against private ventures expanded by 15% to 45% also a year ago. This in itself ought to be a reminder to private companies to protect their organizations against such assaults. The organization also assessed that the effect of cyber violations on the world's economy has soared to $580 billion every year, from the $350 billion experienced only a couple of years back.

The cost of a cyber insurance design is reliant on how the purchaser's business is composing. The business also manages the strategies and methods of the firm, the sort of administrations offered, and their hazard profile. Independent ventures with benefits of amongst $90,000 and $500,000 will have brought down premiums than bigger associations.

The impossibility arises due to a number of reasons

• Customer lock-in and first mover effects of vulnerable security products.
• Difficulty to measure risks resulting in challenges to designing pertinent risk removal solutions.
• The problem of a lemons market, whereby security vendors have no incentive to release robust products in the market.
• Liability shell games played by product vendors.
• User naiveness in optimally exploiting feature benefits of technical solutions.
• The scarce existence of sound technical solutions.
• Network users taking advantage of the positive security effects generated by other users' investments in security. In turn, themselves not investing in security and resulting in the free-riding problem.
• Difficulty in designing solutions catered to varied intentions behind network attacks.
• Misaligned incentives between network users, security product vendors, and regulatory authorities regarding protecting the network.

To read more article... Crop insurance or Agricultural Insurance sector.

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When the advertisement is not the only advertisement !

Advertisement 

Experts, through means, for example, regular postal mail, phone, print, radio, TV, and web. A vital piece of marketing, advertisements are open notification intended to illuminate and rouse. Their goal is to change the reasoning example (or purchasing conduct) of the beneficiary, so he or she is induced to make the move wanted by the advertiser.Advertising is an audio or visual type of marketing communication that utilizes a straightforwardly supported, nonpersonal message to promote or offer a product, services or thought.

Advertisement not only advertisement!

Advertising means just talking about selling and selling products? No, more than advertising. Displaying an advertisement in a country's art and culture, voices against social injustice and injustice, through pen and puffs, roamed through immorality also. And the extraordinary creativity of these advertisements deeply thinks about something, sometimes laughing, and sometimes we know many unknown and unseen many truths. The companies have commercial motives behind such advertising, but they also do such work from the duties of society and environment also. Let's see if there are some great advertisements published in the print media.

Nivia

Worrying in thinking, it is natural to have wrinkles! Image Source: Ads of the World

The German cosmetic brand runs a creamy campaign promoting men's skincare. The concept line of the campaign was 'Because life makes wrinkles'. In the image of campaign advertisements, it is highlighted in the center of a male ballerina. The different view of life was also the main reason for the sacrifices, as was the message of these pictures. Two campaign advertisements are Wari Lines - Kid's and Wari Lines - Cars. Jung Von Matt as the Creative Agency of Advertising

Chupa Chups

   Just liking is the end of the responsibility! Image Source: Ads of the World

Spain's chocolate maker has created quite a stir through this advertisement. In keeping with the health of the children, the company has marketed Sugar-Free Lollipop and it is responsible for promoting creativity by DDB Advertising Agency. Ants are going through a lip line on the open packet, and the ants are not coming in the chalk. Because chocolate has no sugar. In this advertisement, there was a very creative strategy to explain the Sugar-Free issue.

McCain Health Care World Wide, Japan

The organization involved in health-related activities, in 2010, did a great campaign in the World No Tobacco Day. The campaign name is 'No the Ugly Truth'. When the tobacco is consumed, the look gets spoiled in and out from the inside - this information is very nicely illustrated in the picture. This campaign has served as a Creative Agency - McCann Erickson, Tokyo.

Crisis Relief Singapore

This organization sponsors a campaign to find volunteers. The campaign name 'Like is not Help'. The images of the campaign advertisements were so much that the disaster image shows a lot of fingers in which the 'like' symbol is meant. And in the copy of the pictures - "Like is not helpful. Bi A Volunteer. Change A Life ' The Campaign receives 'Gold Press Lions' award in the Kansas International Festival of Creativity. Publicis Singapore as a Creative Agency of the Campaign.

Weight Watchers

This is a German healthcare organization that deals with proper weight control. Through some advertisements in a campaign, we have presented ourselves in a very good way to tell about the service. And the name of that campaign is 'Dors'. Published on December 2005, this print has served as a creative advertising agency for advertising - FCB Hamburg. They used no tagline or speech in the advertisement. But in the picture, it is so clear and beautiful that it is possible to understand the exact picture they are trying to say.

King Khalid Foundation

This non-government organization works with human rights. To stand against women's oppression, 'The Thing Things Cant B Coverage' They have a campaign named 'Fighting Women Abuse Together'. Each image of campaign advertisements has a sharp and sharp idea. As soon as they are seen, they force people to think. Interestingly, this is the first advertisement in Saudi Arabia to stand against female oppression. Agolve, Saudi Arabia, as a creative agency of this work

WWF

Founded in 1961, this non-government organization undertakes awareness building and protecting nature. Through a campaign, they want to make people aware that every species of the ecosystem is working also for the survival needs of the people. And the absence of any of these may be a threat to the survival of humans. This ad has been very creative with the presence and absence of shark fish, the advertisement company DDB, Turkey.

Ecovia

Ecovia is an organization that mainly works as travel and tourism, transport and volunteer. In January 2013, they worked in a campaign, which was to warn people about talking on mobile phones and sending pet messages while driving. During the driving, this kind of work could be the cause of major accidents, it was said that their main motive. The name of the campaign was 'Stop the Violence, Do not Text and Drive'. Campaign advertisements were published in Brazilian magazines and magazines. This ad serves as a Creative Agency -Tereremoto Propaganda Curitiba

McDonald's

Who does not know the name of the world famous! Most of McDonald's ads are intelligent and viewable also. One of them is their 'Big Coffee' ad. 1.5 In Europe, coffee is available here - this topic is mainly for promotion. The picture of this advertisement can be spoken! The organization shew The coffee refill cup in the picture as it would seem like an infinity pool. That means you can get a lot of coffee also at the nominal cost. The creative agency of this ad was - DDB, Finland.

Save the children

This international non-governmental organization works on issues related to children's rights and children. They show an issue through the campaign also called 'Break the Circle'. The matter is that 70 percent of the oppressed children grew up with tortured also. This campaign is very well promoted through three different print ads. There were three advert names - Kitchen Circle, Bedroom Circle, and Living Room Circle. Has served as a creative agency for advertising - Y & R, Mexico.

Maxam toiletries

China's toothpaste maker promotes a campaign called 'Civilization' to make teeth aware of the problem of corrosion and prevention. This campaign had two print advertising- Civilization in Egypt and Civilization in Rome also. There are so many ways in which the tooth decay is so beautifully illustrated that there is no way to be impressed. The Campaign received Gold Gold Award and Gold Press Lyons Award at the Kansas International Festival of Creativity. Works as a Creative Agency for Advertising - JWT (J. Walter Thompson).

The number of such advertised advertisements all over the world but not least! Later on, we'll talk about some extraordinary ads.

To read more article... Strategics of Bank Marketing

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What will the bank of the future look like?

General words

                                     Picture: Bank by mobile

Lionel Barber, the supervisor of the Financial Technology (Fintech), summed it up at Davos: "No one needs to be in bank and banking, everybody needs to be in blade tech". Fintech or financial technology has achieved the standard, yet what does this mean for the banks? The Fourth Industrial Revolution is grabbing hold in banking. The rise of Fintech came about over the last five years essentially as the consequence of five key advancements:

1. Regulation that truly looks after the rights of the consumer's

                                                                   Picture: Face to face banking

The financial sector is tightly controlled, regulated and which is all well. And good purchase assurance should dependably be the need. In any case, control can energize advancement in the meantime as securing our rights. In a few nations, the controllers are more agreeable, more adaptable. And have reacted speedier to the appearance of financial disrupters. For instance, in the UK Financial Conduct Authority (FCA) set up Project Innovate in 2014 to work with creative organizations. An approach which others, for example, Singapore and Australia have taken after. In any case, in different nations, an organization is required to be a "bank" to do an entire scope of financial administrations. Regardless of the possibility that it's limiting itself to one movement, for example, installments. This makes it harder for challengers to enter the market.

2. The rise of the mobile internet

With a cell phone, we have a supercomputer in our pocket and are constantly associated. The way we bank is changing as a feature of this large scale drift. Conventional banks have made the move from branch to online and all the more as of late, to mobile also. Our desires of how and where we can do our banking have changed.

3. Higher expectations

As different zones have been upset: purchasers are currently used to a superior ordeal one that is speedier, less expensive, more advantageous. And we're utilized to more decision. Our involvement in everything from correspondence to music is currently empowered by tech. By correlation, financial administrations look and feel obsolete and confined.

4. The rise of the millennials

The rise of the millennials made another statistic whose desires are altogether different. Millennials are the biggest era in world history and will soon order the biggest wallet control too. adoption across age groups has driven the growth of Fintech but the demand from the millennial generation to innovate and think about financial services differently has been a catalyst for change also.

 

5. Loss of trust in the global financial crisis of 2008

In particular, the banks lost our trust. Financial administrations and services have dependably been about trust. Maybe the greatest boundary to section has been getting new clients to put stock in an obscure brand or benefit. And that is especially valid with computerized disruptors who do not have a physical nearness on the neighborhood high road. The financial crisis of 2008 made a seismic move in the flow of trust in financial administrations. Fintech would have occurred without the global financial crisis - yet it would have taken any longer.

 

The bank of the future?

These five advancements established the frameworks for change sufficiently giving catalyst to the main flood of disturbance to pick up footing and demonstrating the idea of a contrasting option to banks.

New participants will now go to a market where a large number of potential clients have officially swung to a nonbank innovation organization for their banking needs - and will expect more. Indeed, even those clients who don't as of now need or utilize a blade tech administration will consider them as an option equivalent to or superior to a bank.

Customer Expectation

Customers expect a noteworthy move in their own conduct throughout the following five years, as indicated by YouGov inquire about for a report distributed by my own particular organization, Transferwise. In 2015, 68% of individuals had never utilized an innovative supplier for store payments, international money transfers, lending, wealth management, property investment also. In five years, half (48%) of shoppers hope to utilize an innovative supplier for no less than one financial administration. A third (32%) hope to utilize an innovative supplier for half or a greater amount of their financial needs.

Customer Hopefulness

As the existing banking model is unbundled, everything about our financial services experience will change. In five to ten years, the industry will look fundamentally different. There will be a host of new providers and innovative new services. Some banks will take digital transformation seriously. Others will buy their way into the future by taking over challengers and some will lose out. Nonbanks will almost universally control Some segments. Other segments will be better within the structural advantages of a bank also. Across the board, consumers will benefit as players will compete on innovation and customer experience.

Looking forward to ten years, the picture changes much more significantly. 20% of buyers suspect they will trust innovation suppliers with all their financial administration no matter how you look at it from Visas to contracts.

Financial Administration

As the current banking model is unbundled, everything about our financial administration's experience will change. In five to ten years, the industry will look essentially changed. There will be a large group of new suppliers and imaginative new administrations. A few banks will consider computerized change important. Others will purchase their way into the future by assuming control challenges and some will miss out also. A few portions will be all around controlled by nonbanks; different sections will be better inside the auxiliary points of interest of a bank. No matter how you look at it, purchasers will profit as players will contend on development and client encounter.

"The democratization of finance"

The most vital outcome will be the genuine democratization of fund. The idea of the current "packaged" model of banking is in a general sense out of line. The expenses of the framework and the benefits of the banks are overwhelmingly collected from charges and charges that hit the poorest hardest also. Worldwide installments are a prime illustration. An expansive extent of those making exchanges is those to whom the normal 7.68% cost is a gigantic weight also. As the supervisor of the Fintech opportunity and drives change, the final product will be the expansion of financial chance to numerous more individuals. The expenses charged will never again be unbalanced to the administration. Also, reserve funds and speculations will collect better returns for the general population that holds them.

As indicated by the World Bank, the fall in the cost of sending worldwide installments in the course of the most recent five years, driven by the passageway of new, less expensive choices, has officially spared clients more than $60 billion since 2010 also.

Moreover

The monopolistic condition made by the banks made it troublesome for challengers to enter the market. Accordingly, the early disruptors in financial administrations needed to acquaint more noteworthy straightforwardness all together with content also. With more noteworthy straightforwardness comes more noteworthy opportunity and more prominent decision. This has gotten the wheels under way for an upheaval in the segment. In five years, the division will see expanded rivalry and better options also. In ten years, it will have changed. And the adjust of energy inside the connection between the customer and the suppliers of financial administrations also. It will have in a general sense changed.

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