Senior high school

 
 
What is It

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NegOr_Q4_UCSP11_Module7_v2 
BANKING INSTITUTIONS 
The Bangko Sentral ng Pilipinas is known as the banks of all banks in the 
Philippines. It is the bank responsible for the regulation, creation, and management of 
monetary supply in the country. 
These are the different types of banks: 
• Commercial banks accept savings deposits, check deposits, and time deposits. 
Examples 
of 
Philippine 
commercial 
banks 
are Bank 
of 
the 
Philippine 
Islands and Metrobank. 
• Thrift banks are categorized into stock savings and loan associations, savings and 
mortgage banks, and private development banks. They consolidate the savings 
deposits of their members into a fund from which their members can draw loans with 
interest. They also accept deposits from the public and provide loans for small- and 
medium-scale enterprises. 
• Rural banks cater primarily to farmers and small business people, mostly in rural 
areas. 
CORPORATIONS 
A corporation is an organization of people legally bound by a charter to conduct some 
type of business. It has a legal entity separate from its owners. The type of business that a 
corporation wants to venture in depends on its articles of incorporation. 
Articles of incorporation are written applications to the government requesting 
permission to form a corporation. This will give the name, address, and type of business for 
the corporation; the names of the officers, and the initial amount of money being put into the 
business. 
The following are the advantages of corporations as business organizations in the 
economy: 
• easy to raise funds–since the corporate form is the most effective for raising money 
• limited liability–the concept that owners of the business are only responsible for its 
debts up to the amount they invest in the business 
• unlimited life–not ceasing to exist if a major stockholder dies 
• specialized management–affording to have specialized managers to run the business 
• shared risks–spreading business risks among many owners 
The following are the disadvantages of corporations as business organizations in the 
economy: 
• difficult to start–needs government approval before starting the business 
• less direct control–owners that are usually far from the day-to-day operation of the 
business 
• double taxation–corporate taxes that need to be paid by the corporation and the owner 
who received dividends from the profit 
• limited activities–limited activities by the article of incorporation 
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