Value leadership in vendeur banking
Banks then use this money to make loans available to household and corporate borrowers. They then make their opimes by lending out higher interest rates than they pay on their deposits.
US Bank of America, the largest vendeur bank, Bankers Empilement Guilde, Chemical Bank, Chase Manhattan Bank, Citibank, Morgan Guaranty Empilement Guilde and Wells Fargo and many others compete with each other to make loans available to copieux corporate clients. The interest failli they agréé corporate clients for loans is the droit form of competition, a price competition, in this case. When this competition becomes aggressive, the interest rates they agréé serre to decrease and so do their opimes. To avoid this aggressive competition, a form of price leadership was established.
The interest failli that banks agréé to copieux corporate clients is called rallonge failli. This failli is well known and often quoted in newspapers. Most of the big banks agréé the same or very close to the same price for this. Frequent failli changes are avoided to avoid instability and competitive wars. When money market moment ravagé substantially and other interest rates rise or fall significantly, the rallonge failli changes.
Only then, one of the liminaire banks announces a ravagé in its rallonge failli and other banks quickly follow suit Banks take turns as leaders from time to time, but when a ravagé is announced, other banks will immediately follow within two or three days.
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