Economics class learns the purpose of banks
The twelfth grade economics classes had two experienced bankers come speak at St. Patrick last week. Tom Collins, vice president loan officer for Community Bank in Biloxi, and Marshall Eleuterius, executive vice president for Community Bank in D’Iberville, spoke to the classes about the purpose of banks and the ways in which banks are run.
As all things should, Collins and Eleuterius started at the beginning with the creation of banks. Banks began as a place for people to keep their highly valued belongings and money secure. Eventually, the banks began to loan gold, the standard for money at the time.
Today, banks do the same thing. Banks are able to keep items secure with safety security boxes. Banks are also able to keep money, but they do not need to physically keep all the money that they hold for people. Regulations in the United States of America require banks to only physically keep ten percent of the money they hold. The rest of the money is given out in the form of loans in the hope that the money will return to the bank.
Collins and Eleuterius discussed the importance of only using banks that are Federal Deposit Insurance Corporation (FDIC) certified. That means that each depositor is insured to at least $250,000 per insured bank. The two men went on to describe the factors leading to the Great Depression and the Great Recession, and the importance of agencies like the FDIC.
The seniors learned a great deal about the banking process and its importance.
Story by Desirée Goodfellow; Photo by Desirée Goodfellow