Delimitation of ‘Concentration Bank’
A concentration bank is a financial institution that is the cardinal bank of a specific organization. A concentration bank may also be where the league conducts most of its transactions. Several organizations use multiple banks, but by deal significantly with one bank (the concentration bank).
BREAKING DOWN ‘Concentration Bank’
An norm of a concentration bank can be a company that has multiple chain stores across the mother country, with each store depositing its cash into local banks. The New Zealand can set it up so that these funds are concentrated or deposited into one account, inveterately called a concentration account, at a concentration bank.
A concentration account is a stash away account, which aggregates funds from several locations (e.g. from the subject company’s many branches) into one centralized account. Banks may also engage concentration accounts for fund transfers, private banking transactions, pin ones faith and custody accounts, and international transactions.
U.S. authorities heavily scrutinize concentration concentration accounts, due to the plausibility of money laundering. It can be more difficult to follow a money trail if stocks from disparate sources are combined in one central location. The USA Patriot Act recently demanded banks to establish clearer policies for detecting and reporting suspicious goings-on and prohibited customers from moving own their funds into, out of, or finished with the concentration accounts.
Concentration Bank and Investment Management
A company with multiple departments may decide to place its funds in a concentration bank to facilitate investment running, as well. An investment manager will aims to meet particular investment purposes of the company (such as growth or increased liquidity) through a process that may touch asset allocation, financial statement analysis, stock selection, scan of existing investments and plan implementation. Investment management includes protecting a company’s tangible and intangible assets are maintained, accounted for and well-utilized. The universal investment management industry in 2015 was worth an estimated $79 trillion in assets subsumed under management, as measured by a PricewaterhouseCoopers report in 2017.