Swiss Banking Game by wanghonghx

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									Bank Management


BANKING GAME



 Participants' Manual




    Version 8.0 (English)
Table of Contents
1.   Foundations of the Banking Game ........................................................................................ 4
     1.1.    Farewell letter of the outgoing management............................................................. 4
     1.2.    Basic economic and banking-political structures ...................................................... 5
             1.2.1. Development of the world economy................................................................ 5
             1.2.2. Domestic Economic Situation ......................................................................... 5
     1.3.    You take over the bank! ............................................................................................ 6
             1.3.1. Comments on the profit and loss account ...................................................... 6
             1.3.2. Balance Sheet Development .......................................................................... 7
             1.3.3. Administration of Assets ................................................................................. 8
     1.4.    Organisation of the Bank .......................................................................................... 9
     1.5.    How the Simulation Works ........................................................................................ 10
2.   Action Parameters ................................................................................................................. 11
     2.1.    Decision-Taking Form I: Lending / Deposit business ............................................... 11
             2.1.1. Volume Decisions ........................................................................................... 11
             2.1.2. Decisions on Interest Rates ............................................................................ 13
             2.1.3. Market Research Report ................................................................................. 14
             2.1.4. Budgeted Values (million SFr.) ....................................................................... 14
     2.2.    Decision-Taking Form I: Forex ................................................................................. 15
             2.2.1 Decisions „forex“: Share foreign exchange .................................................... 15
             2.2.2 Report Non balance-sheet business – „forex“ ................................................ 16
     2.3.    Decision-Taking Form II: Investments ...................................................................... 17
             2.3.1 Administration of Assets ................................................................................. 17
             2.3.2 Commission rate (%) ...................................................................................... 18
             2.3.3 Transformation of saving accounts into managed accounts .......................... 18
             (maximum 20 %) ....................................................................................................... 18
             2.3.4 Investing liquid funds of your bank (Nostro) ................................................... 18
             2.3.5 Hedging .......................................................................................................... 18
     2.4.    Decision-Taking Form II: Bond issue business......................................................... 19
             2.4.1 Underwriting price (%) .................................................................................... 19
             2.4.2 Rating ............................................................................................................. 19
             2.4.3 Handling of bond issue business .................................................................... 20
             2.4.4 Costs of bond issue business ......................................................................... 20
     2.5.    Decision-Taking Form II: Marketing .......................................................................... 21
             2.5.1 Customer Groups ........................................................................................... 21
             2.5.2 Advertising ...................................................................................................... 22
     2.6.    Decision-Taking Form IV: Personnel ........................................................................ 23
             2.6.1 Additional Personnel Costs (%) ...................................................................... 23
             2.6.2 Employment / Dismissal ................................................................................. 23
             2.6.3 Training ........................................................................................................... 24
             2.6.4 Acquisition and Service .................................................................................. 24
             2.6.5 Fluctuation ...................................................................................................... 24
     2.7.    Decision-Taking Form IV: Logistics .......................................................................... 25
     2.8.    Decision-Taking Form V: Financial Management ..................................................... 26
             2.8.1 Dividend Distribution ....................................................................................... 26
             2.8.2 Capital Increase .............................................................................................. 27
     2.9.    Decision taking form V – part II: holdings ................................................................. 28
             2.9.1 Holdings .......................................................................................................... 28
             2.9.2 Report holdings ............................................................................................... 28
     2.2.    The Management Information System ...................................................................... 29
     2.3.    The Initial Balance Sheet .......................................................................................... 29
             2.3.1. Comments on Balance-Sheet Items ............................................................... 30
     2.4.    Profit and Loss Account ............................................................................................ 34
             2.4.1. Comments on Profit and Loss Account .......................................................... 35
             2.4.2. Explanations of bond issue business .............................................................. 37
             2.4.3. Comments on Index Figures ........................................................................... 37
             2.4.4. Share Price (SFr.) ........................................................................................... 38
             2.4.5. p/e ratio ........................................................................................................... 38
     2.5.    Statement of Flow of Funds ...................................................................................... 39
             2.5.1. Comments on Flow of Funds .......................................................................... 40
     2.6.    Operating Data .......................................................................................................... 41


BANKING GAME                                            Participants' Manual                                                                   2
            2.6.1. Comments on the Operating Data .................................................................. 42
    2.7.    Market Data .............................................................................................................. 43
            2.7.1. Comments on the Market Data ....................................................................... 44
    2.8.    Reference rate system .............................................................................................. 45
            2.8.1. Notes to the reference rate system ................................................................. 46
    2.9.    Market and Competition Report ................................................................................ 47
            2.9.1. Comments on the Market and Competition Report ........................................ 49
    2.10.   Capital Adequacy Report .......................................................................................... 50
            2.10.1. Comments on the Capital Adequacy Report ................................................. 51
    2.11.   Liquidity statement .................................................................................................... 52
            2.11.1. Comments on the Liquidity Statement .......................................................... 53
    2.12.   Survey of Share and Bond Portfolio .......................................................................... 54
            2.12.1. Comments on the Survey of Share and Bond Portfolio ................................ 56




BANKING GAME                                        Participants' Manual                                                                    3
1.      Foundations of the Banking Game

1.1.    Farewell letter of the outgoing management




Dear successors,



My colleagues in the management and I would like to give you a warm welcome on your first
day at the bank.

As you already know, the present management has unanimously decided to step down for
reasons of age and in order to make room for younger executives.

For quite a few years we have worked successfully on the national and international bank
market. Last year we achieved an annual surplus of 175 million SFr. after tax and employed
a total of over 6’795 members of staff.

The future prospects for banking institutes with comprehensive services are good- this was
revealed in a survey about the market chances to be expected, extracts of which you will find
below:

"The competitive situation of many enterprises is characterized by an increasing pressure of
costs on the one hand, and the necessity of working intensely on the market on the other
hand.

In the course of this development it can be observed that small banking institutes are
increasingly being ousted by the major, international institutes.

This development is being accelerated by the reduction of margins in interests and may lead
to further mergers in the future."

In order to provide you with some assistance we have left at your disposal all the records
about the particulars of your enterprise and the information about the past fiscal year.


                                              Wishing you every success

                                              Yours sincerely,



                                              Robert F. Chairman



BANKING GAME                           Participants' Manual                                4
1.2.     Basic economic and banking-political structures


1.2.1.   Development of the world economy
         The development of the world economy over the last few years has been marked by the long-
         lasting economic boom which has been on the rise up to the present. All the industrialized
         countries have more or less profited from this upward economic trend even though it must
         not be forgotten that regional differences have increased in most recent times. Especially in
         Europe new impetus to growth has been released due to the EU programme as well as to the
         reform movements in Eastern Europe. The future development of the European Community
         is of particular importance to our own economy. However, the undeniable opportunities
         provided by the joint German economic region are clearly juxtaposed by obvious risks,
         particularly in terms of interest and currency.

         The creation of a European monetary union is expected to have a substantial effect on the
         banking and financial markets. Even now there are signs of increased competition among
         banks within the EC. Since the regulations concerning flexibility and liberalization are likely to
         be taken over in one way or the other, competition for the domestic banking trade is also
         expected to become stiffer.



1.2.2.   Domestic Economic Situation

         The home economy heavily depends on the development of world economy as it is highly
         foreign-oriented. Generally speaking, the development of the home economy has to a large
         extent kept in line with that of the world economy in the recent past.

         Competitive pressure has been on the increase in banking over the last few years. The fast
         and long-lasting changes in environmental conditions came as a surprise to many banking
         institutes, especially medium-size and smaller ones. An almost completely drained labour
         market, rapidly changing information and processing technologies, changes in customer
         profiles and narrow profit margins in commodities are but a few key words to describe the
         currently altering competitive situation. The competition in banking is likely to become even
         stiffer in the near future.




BANKING GAME                                Participants' Manual                                         5
1.3.     You take over the bank!

1.3.1.   Comments on the profit and loss account
         Lively business in almost all areas resulted in satisfactory improvement of the profit and loss
         account. Cash-flow as well as profits showed a two-digit increase rate for the first time in 3
         years. In comparison to the previous year, net profits rose by 25,0 % to 175 million SFr.



         Yield
         The repeated considerable improvement in the interest income (+ 215 million SFr. or + 12,4
         %) was exclusively due to the greater volume of loans. The margins were under continuous
         pressure especially in the mortgage loan business.



         Expenditure
         Thanks to specific attempts at saving, the costs in the last period clearly rose more slowly
         than the operating profit. Approximately 50% of the increase in expenditure of 138 million
         SFr. were taken up by staff costs.




                            Yie ld                                      Expe nditure
                            Period 0                                         Period 0


            1400                                             1200         58
            1200                                             1000         192
                         606
            1000                                              800         200
             800                                                          214
                                                              600
             600
                                                              400
             400         755
                                                                          522
             200                                              200

               0                                                0
                         Commission Income                                 Tax
                         Interest Margin                                   Losses
                                                                           Write-Downs
                                                                           Adm. costs
                                                                           Personnel costs




BANKING GAME                                 Participants' Manual                                     6
1.3.2.   Balance Sheet Development
         The balance sheet total increased by 9,8 % to 42459billion SFr. during period 0. This
         development is slightly below average compared to those of larger banks.



         Assets
         In the lending business the increase of loans granted to customers was again average
         (+2,012 billion SFr. or about 5,2 %). Their share of the total assets amounted therefore to
         approximately 71,6 %. The share of due from banks dropped slightly from last year's 14,0 %
         to 12,8 % of the balance sheet total.




                  Mio Fr
                 45000
                 40000                                           3480
                                    1680
                 35000
                                    11569                       12304
                 30000
                 25000
                 20000
                                    16829                       18106
                 15000
                 10000
                  5000              5430                         5450
                     0              3144                         3119
                                  Period -1                    Period 0

                   Liquid Funds     Due from Banks     Due from Customers    Mortgage Claims   Other Assets




         Liabilities
         The shift from savings deposits to the more profitable time deposits, which was noted in the
         deposit business the previous year, continued faster and thus made refinancing considerably
         more expensive. Since the share of commercial loans has also increased, the balance sheet
         may still be regarded as profitable.




                   Mio Fr
                  45000
                  40000                                          3510
                                    3335
                  35000                                          7488
                                    7050
                  30000
                  25000
                  20000                                         26361
                  15000             23'467
                  10000
                   5000
                                    4800                         5100
                      0
                                  Periode -1                   Periode 0

                     Due to Banks           Due to Customers       Medium-Term Notes      Other Liabilities




BANKING GAME                                     Participants' Manual                                         7
         Capital Resources
         At the end of period 0 the share capital remained unchanged at 800 million SFr. The re-
         serves were credited with 140 million SFr. in the reported year.



         Net Profit
         With a gross profit of 625 million SFr. and write-downs, provisions and losses as well as
         taxes of 450 million SFr., the fiscal year of period 0 shows a net profit of 175 million SFr..
         Compared to last year the increase of net profits amounts to 35 million SFr. or 25,0 %.




                                                  Net profit
                           MioFr
                          200
                                                                                  175
                          150                              140
                                  118
                          100

                           50

                            0
                          Period -2                  Period -1               Period 0




1.3.3.   Administration of Assets
         Management mandate orders do not figure in the balance sheet and amounted to 11,2 billion
         SFr. in period 0. This is an increase of 5.3 % compared to the previous year. 50 % of all the
         accounts managed, whose interest rates were extremely attractive as opposed to the
         previous years, were invested in SFr. The performance of 4.6 %, however, is below the
         banking average.




                                        Administration of Assets


                                             Domestic Money      Foreign Money
                                                Market               Market
                                                  10%                 10%
                           Foreign Shares
                                20%                                       Domestic Bonds
                                                                              20%



                                Domestic Shares                  Foreign Bonds
                                     20%                              20%




BANKING GAME                                 Participants' Manual                                    8
1.4.   Organisation of the Bank


         Fin a n c ia l Ma r k e ts      Fo r e ig n C u r r e n c y                                             C e n tr a l Ba n k                     C lie n ts
                                                                                Ba n k in g L a w s
                                              Ma r k e ts




                                                                   Swiss Bank
                                                                          Management


                                                                                                                Marketing




                              Commerce                         Finance                        Money                           Personnel
                                                                                              Transfers




         Lendin g Busin ess                       Deposit Bu siness                           Securities Business                        Asset Administratio n




                        P riv ate     P riv ate        P riv ate       S mall            Medium         Large            P ublic          Institution.

                        H ouseholds   H ouseholds      H ouseholds     E nterprises      E nterprises   E nterprises     C orporations    Investors

                        <45           >45              >65

                                                                       Cu stomer G rou ps




                  Co mp etito r 1                     Co mp etito r 2                         Co mp etito r 3                      Co mp etito r 4




BANKING GAME                                                       Participants' Manual                                                                               9
1.5.   How the Simulation Works


       The different stages of a simulation for a bank (= work team) can be presented as follows:


       1. Starting Position                               2. Forecasts
       National economic developments                     Expected development of      national
       (economy, interest level, exchange rate            economy and competitors
       etc.)

       Business results of the bank
       (balance sheet, profit and loss account,
       and evidence of collateral security




       3. Analysis
       Environmental situation and situation of own bank

       4. Objectives
       Definition of strategic and operative objectives

       5. Decisions
       Provisionally establish action parameters

       6. Budget
       Calculate results expected

       7. Final Decisions
       Take final decisions on the basis of budget results




       8. Simulation
       Input of all the decision variables into the computer model and computation of the
       results




       9. Results
       Inform the individual banks about the results

       Comments and explanations by instructors



       These work phases represent a fiscal year (= period of play). During the course of a
       seminar several fiscal years are simulated.




BANKING GAME                              Participants' Manual                                      10
2.       Action Parameters

2.1.     Decision-Taking Form I: Lending / Deposit business




         Decisions regarding Volume and Interest for the lending and deposit business can be made
         on Decision-Taking Form I.



2.1.1.   Volume Decisions
         Your bank can make volume decisions on the balance-sheet items "Due from banks on
         demand/at term" and "Bond loans".



         Due from Banks

         The desired volumes for these items can be entered into the respective spaces provided.
         These amounts flow out of the liquid funds and thus yield interest. The interest rates are
         determined by the market and can be taken from the economic scenarios.

         The interest rates at the starting point (Period 0) amounted to:

         Due from Banks on demand:         0.00 %
         Due from Banks at term:           6.75 %


         Your decisions per period on due from banks are absolute and not additive to the
         previous period.



BANKING GAME                               Participants' Manual                                 11
     This means that the volumes of "Due from banks", which you enter into Decision-Taking
     Form I, will appear in this amount on the balance sheet. If you do not enter anything, the
     value on the balance sheet will therefore be 0.



     Bond Loans

     In order to acquire long-term liabilities the bank can issue bonds with a duration of 10
     years and a fixed interest rate. The interest rate for new issues depends on the current
     situation on the capital market and can be taken from the economic scenario.

     The interest rate at the starting point (Period 0) amounted to:6.0 %


      Your decision is additive to the previous periods. Bonds of SFr. 140 million are due
      per period.



     Subordinated Bonds

     The bonds may be partly or wholly issued as subordinated bonds. The respective volume can
     be entered into the space "of which subordinated" (for further information see also 3.1.1.
     Comments on Balance-Sheet Items).



     Restrictions on Volumes

     There are maximum values per period regarding volume decisions. They are compulsory for
     the whole seminar and remain unchanged.


      Assets (million SFr.)                 Max.        Liabilities (million SFr.)   Max.
      Due from Banks          on demand        10,000 Bond Loans                        1,000
                              at term          10,000




BANKING GAME                           Participants' Manual                                     12
2.1.2.   Decisions on Interest Rates
         You determine the interest rates of the following assets and liabilities that are valid for your
         bank during the next period.


            ASSETS                                              LIABILITIES
            Due from customers                                  Due to banks
             secured by mortgage                                on demand
             other security                                     at term
             unsecured                                         Due to customers
            Mortgage claims                                      saving deposits
             variable                                           investment deposits
             fixed                                             Due to customers, other
                                                                 on demand
                                                                 at term
                                                                Medium-term notes



         Restrictions on Interest Rates

         You can only make decisions on interest rates within a given margin. You will be told the
         respective margins for each period. The minimum and maximum values for period 0
         amounted to (as an example):


           Assets (%)                              Min. Max.   Liabilities (%)                          Min.   Max
                                                                                                                .
           Due from             sec. by mortgage   5.00   8.00 Due to                on demand          0.00   1.00
           customers            other security     5.50   8.50 banks                 at term            5.20   8.20
                                unsecured          6.00   9.00 Due to                saving deposits    3.50   6.50
           Mortgage claims      variable           5.50   7.50 customers             investm. dep.      0.50   3.50
                                fixed              5.25   8.25 Due to customers,     on demand          0.00   3.00
                                                               other                 at term            5.00   8.00
                                                               Medium-term notes                        4.50   7.50




         Due from Customers: Shares Current Account Advances and Fixed Advances

         The credits are either given as current account advance or as fixed advance. The credit
         commission for the current account advances is 1 % p.a. The credit commission is regarded
         as part of the interest and is therefore part of the interest margin.

         The shares of current account advances and fixed advances are as follows:


                                                                                   Share CA            Share FA
                                                                                     (%)                 (%)
           Due from              secured by mortgage                                  90                 10
           customers             other security                                       40                 60
                                 unsecured                                            40                 60




BANKING GAME                                 Participants' Manual                                              13
         Consequences of Decisions on Interest Rates

         Your decisions affect the customers' behaviour regarding the individual balance-sheet items.
         The volumes of the various columns are computed as follows:



                                  Loss of forme r custome rs                     Growth

                                                               Market
                                                               volume

                 Bank




         Better interest conditions in comparison with our competitors result in losing fewer old
         customers and in gaining new customers, i.e. the bank is certain to grow faster than its
         competitors in this area.

         Remember that market volume can rise or fall if bank rates are out of line with market rates.
         An interest rate which is in line with the market is defined as follows: the average of the
         relevant minimum and maximum rates (exceptions: due to banks - day-to-day and fixed-term
         liabilities; due to customers - investment deposits and day-to-day liabilities) in the interest-
         rate table (for current interest-rate table, see the economic report).



2.1.3.   Market Research Report
         You can order a market research report in order to obtain information on the decisions as
         well as the market shares of the competitors. It costs 3 million SFr. and will be debited from
         the profit and loss account under "Other Expenditures".



          Yes     You will obtain the Market Research Report

          No      You will not obtain the Market Research Report




2.1.4.   Budgeted Values (million SFr.)
         Input of the balance-sheet total and the net profits on the basis of the balance sheet
         budgeted. The quality of planning will have a positive effect on the success rate ( see
         profit and loss account).




BANKING GAME                                Participants' Manual                                      14
2.2.     Decision-Taking Form I: Forex



FOREX                                                P0    P1     P2    P3     P4    P5     P6
Share Foreign Exchange
Due from banks at term                       %        0
Due to banks at term                         %        0
Hedging open forex position                  %        0


         If the module „forex“ is activated, certain balance sheet positions are calculated in foreign
         exchange (Euro). The report „forex“ gives you an overview of these positions




2.2.1.   Decisions „forex“: Share foreign exchange
         With the additional decision in the decision taking form I – „forex“: share foreign exchange,
         there is the possibility to reduce or level surpluses or deficits of foreign exchange by
         increasing / decreasing the share of foreign exchange of the positions „due from banks at
         term“ or „due to banks at term“.

         Open foreign exchange positions on the assets or liabilities side can be hedged partially or
         completely. The hedging costs are 2 % of the amount hedged.




BANKING GAME                              Participants' Manual                                     15
2.2.2.   Report Non balance-sheet business – „forex“
         In the first part of the report the shares of foreign exchange are indicated. Too high amounts
         of open foreign exchange positions have a negative influence on the share price.

         In the lower part, the open foreign exchange positions of the previous period are newly
         assessed. The resulting profit or loss (including hedging costs) is shown in the profit and loss
         account under the position „income from trading“.


┌─────────────────────────────────────────────────────────────────────────────────────────────────┐
│                                                                                                 │
│ FOREIGN EXCHANGE                                                                                │
├───────────────────────────────┬───────┬────────┬───────────────────────────────┬───────┬────────┤
│ FOREIGN EXCHANGE ASSETS       │ in % │ Mio E │ FOREIGN EXCHANGE LIABILITIES │ in % │ Mio E │
├───────────────────────────────┼───────┼────────┼───────────────────────────────┼───────┼────────┤
│ Due from banks                │       │        │ Due to banks                  │       │        │
│   at term                     │ 25,00 │    697 │   at term                     │ 30,00 │    818 │
│                               │       │        │                               │       │        │
│ Claims in resp. of MM Paper   │ 50,00 │    152 │ Due to customers              │       │        │
│                               │       │        │   saving deposits             │ 0,00 │       0 │
│ Due from customers            │       │        │   investment deposits         │ 18,00 │    392 │
│   secured by mortgage         │ 0,00 │       0 │                               │       │        │
│   other security              │ 13,00 │    478 │ Due to customers, others      │       │        │
│   unsecured                   │ 21,00 │    960 │   on sight                    │ 12,00 │    276 │
│                               │       │        │   at term                     │ 27,00 │   1322 │
│ Mortgage claims               │       │        │                               │       │        │
│   variable interest rate      │ 0,00 │       0 │                               │       │        │
│   fixed interest rate         │ 0,00 │       0 │                               │       │        │
│                               │       │        │                               │       │        │
│ Securities trading portfolio │        │        │                               │       │        │
│   foreign shares              │ 100,0 │    303 │                               │       │        │
│   foreign bonds               │ 100,0 │    303 │                               │       │        │
│                               │       │        │                               │       │        │
├───────────────────────────────┼───────┼────────┼───────────────────────────────┼───────┼────────┤
│ TOTAL FE ASSETS               │ 13,07 │   2893 │ TOTAL FE LIABILITIES          │ 15,01 │   2808 │
├───────────────────────────────┼───────┼────────┼───────────────────────────────┼───────┼────────┤
│ SURPLUS ASSETS                │       │     84 │ SURPLUS LIABILITIES           │       │        │
│ not hedged                    │ 100,0 │     84 │ not hedged                    │       │        │
│ in % of capital               │       │    5,5 │ in % of capital               │       │        │
├───────────────────────────────┴───────┴────────┴───────────────────────────────┴───────┴────────┤
│                                                                                                 │
│ GAINS / LOSSES FROM FOREIGN EXCHANGE                                                            │
│                                                                                                 │
├───────────────────────────────────────┬────────┬────────────────────────────────────────────────┤
│ Surplus liabil. prev. period    Mio E │ 390,3 │                                                 │
│ not hedged 100%                 Mio E │ 390,3 │                                                 │
│ Valuation     at rate of   1,65 MioFr │ 644,0 │                                                 │
│ New valuation at rate of   1,65 MioFr │ 644,0 │                                                 │
├───────────────────────────────────────┼────────┤                                                │
│ Profit (+) / Loss (-)           MioFr │    0,0 │                                                │
│ - Hedging costs (-)             MioFr │    0,0 │                                                │
│ Profit (+/-) (hedg. cost incl.) MioFr │    0,0 │                                                │
└───────────────────────────────────────┴────────┴────────────────────────────────────────────────┘




BANKING GAME                               Participants' Manual                                       16
2.3.     Decision-Taking Form II: Investments




         On Decision-Taking Form II you determine the investment strategy for the customer deposits
         for which your bank was given management mandates, as well as for the Nostro funds (liquid
         funds of the bank). The following investment options are available:


                       Domestic Money Market Papers
                       Foreign Money Market Papers in EURO
                       Domestic Shares
                       Foreign Shares in EURO
                       Domestic Bonds
                       Foreign Bonds in EURO




2.3.1.   Administration of Assets
         In the column Client (%) on Decision-Taking Form II you divide the customer deposits that
         are managed by your bank up into the various investment options (in %).

         Frequent shifts from one option to another supply the bank with additional commission
         earnings (brokerage), but they reduce the customers' yield.




BANKING GAME                             Participants' Manual                                   17
2.3.2.   Commission rate (%)
         With this decision you determine the percentage of commission rate, which you charge for
         your services in the securities business.

         The amount of the commission rate in comparison with that of competitive banks has a
         further negative or positive effect on the customers’ behaviour (turnover) in the areas asset
         administration and custodianship business.



2.3.3.   Transformation of saving accounts into managed accounts
         (maximum 20 %)
         By taking this decision you may transform high amounts on saving accounts into managed
         accounts. By doing so, you prevent customers with high amounts on saving accounts from
         leaving your bank and going to your competitors.
         In addition, your bank may possibly gain further savings accounts



2.3.4.   Investing liquid funds of your bank (Nostro)
         By investing liquid funds in money market papers, shares or bonds it is possible to improve
         the profitability of your bank.

         You decide on the funds of your bank in absolute amounts. The amount entered for money
         market papers is absolute, i.e. not additive to the previous periode. The highest possible
         volume is SFr. 5’000 million per period. With shares and bonds you only note the changes
         compared to the previous periode (buying + / selling -). Buying and selling is always carried
         out at the current rates.



 2.3.5. Hedging
         By ticking Yes or No you decide wether you want to protect the customer deposits or your
         securities against a change in price (column PUT price) and / or against fluctuation in foreign
         currency (column PUT EURO).

         Hedging takes place at the end of a period. The investments are then secured against losses
         of market value and currency risk in the next period.

         The cost of hedging can be taken from the economic scenarios of the respective period.




BANKING GAME                               Participants' Manual                                      18
2.4.     Decision-Taking Form II: Bond issue business



         Bond issue business
                                                            P0         P1          P2         P3              P4
         Issue A, Underwriting price              %         0,00
         Issue B, Underwriting price              %         0,00
         Issue C, Underwriting price              %         0,00


         In each period you have the possibility to underwrite up to three bond issues. In the economic
         scenario you find the following information concerning these three issues

             Name:                              A
             Interest rate:                     %
             Duration:                          period X – period Y
             Rating:                            AAA, AA, A, BBB, BB, B
             Minimum underwriting price:        %



2.4.1.   Underwriting price (%)
         In the decision taking form your decide the underwriting price for the whole issue. The bank
         with the highest price will carry out the issue. If several banks offer the same price, this issue
         will be shared among them.



2.4.2.   Rating
         The rating shows the solvency of the borrower. A bad ratio increases the risk, that not all
         bonds will be subscribed by the clients

         Rating             Explanation
         AAA                Best quality. The ability of the borrower to pay interest and repayment is very
                            high.
         AA                 Good ability of the borrower to pay interest and capital. Together with the first
                            category these are the high quality papers
         A                  The bonds are of high quality, but the solvency could be influenced
                            negatively by political or economical incidents.
         BBB                The probability of repayment in time is quite good. A change of the
                            economical situation might change the solvency of the borrower.
         BB                 These bonds have a speculative element. Payment of interest and capital is
                            only secured, if the economical situation remains stable.
         B                  The security of payment during a long period is rather small.




BANKING GAME                                Participants' Manual                                        19
2.4.3.   Handling of bond issue business
         The bond issues       underwritten by your bank are placed immediately with your clients
         immediately. The      issue price is always 100 %. Wether the bond issuc is completely
         subscribed by the    clients depends on the interest rate compared to the market interest
         rate (according to   the economic scenario) and the rating of the borrower.

         If the bond issue is not completely subscribed (subscription quota < 100 %) will be sold
         immediately with a discount (difference between 100 % and the lower selling price).



2.4.4.   Costs of bond issue business
         The underwriting of a bond issue causes fixed and variable costs. The fixed costs are 10 Mio
         SFr. and do not depend on the issue amount and the number of bond issues allocated to
         your bank. The variable costs are 1 % of the issue amount allocated.


         Example:

         5 % Bond, Period 0 – Period 12, Rating: BBB
         Market interest rate: 5 ½ %

         Issue amount:                            2000 Mio Fr.
         Underwriting price:                            96 %
         Subscription quota:                            90 %
         Discount:                                        8%

         As the interest rate of the issue is lower than the market interest rate and the rating is bad,
         the issue is not completely subscribed.


             Underwriting commission:        80 Mio Fr. (4 % of 2000 Mio Fr.)
         -   Discount                        16 Mio Fr. (8 % of 200 Mio Fr.)
         =   Income from bond issue business 64 Mio Fr. (see profit and loss account)

             Fixed costs                            10 Mio Fr.
         +   Variable costs                         20 Mio Fr. (1 % von 2000 Mio Fr.)
         =   Total costs                            30 Mio Fr. (see operating expenditure)




BANKING GAME                               Participants' Manual                                      20
2.5.     Decision-Taking Form II: Marketing




         On Decision-Taking Form III you determine the marketing strategy, i.e. which group of
         customers is to be served with which products / services.




2.5.1.   Customer Groups
         Customers are divided into seven groups:

                  Private Households < 45 years                 (HH<45)
                  Private Households > 45 years                 (HH>45)
                  Private Households > 65 years                 (HH>65)
                  Small enterprises                             (SE)
                  Medium enterprises                            (ME)
                  Large enterprises                             (LE)
                  Public corporations                           (PCORP)

         By allocating priorities you decide on how you want to serve the individual customer groups in
         the areas

                  Lending business       (Due from customers / mortgage claims)
                  Securities             (Custodianship Business)
                  Deposit business       (Saving dep., Term deposits, medium-term notes)

         with the help of the personnel you entered on Decision-Taking Form IV for acquisition and
         service.




BANKING GAME                               Participants' Manual                                     21
         You may give whole numbers from 0 to 3 (0,1,2,3) to the priorities on the form. The same
         values may occur several times in the same row.

                                   Priorities
                                   0   =   no priority
                                   1   =   low priority
                                   2   =   medium priority
                                   3   =   high priority


         Concerning Credits and Securities you may distinguish between acquisition and service. In
         liabilities you can only determine the priority for service.

         Acquistion         stands for gaining new customers (growth in this area)
         Service            stands for taking care of the present customers (prevent them from
                            joining the competition)




2.5.2.   Advertising

         You can exert additional influence on your customer's behaviour by making specific efforts in
         advertising. You decide on the amount of advertising expenses and on the kind of advertising
         (customer-segmented advertising or advertising in specific areas).

         In the competitive situation given a minimum of advertising should continuously be pursued.
         At first, an increase in advertising expenses has a strong effect on turnover and market
         share, however, a saturation point will soon be reached after a further increase in expenses.




BANKING GAME                                 Participants' Manual                                  22
2.6.     Decision-Taking Form IV: Personnel




         On Decision-Taking Form IV you determine the Additional Personnel Costs, the Number of
         Personnel, the Training Schemes, and the allocation of Personnel per segment. Furthermore,
         investments may be made in automation which save personnel and thus reduce personnel
         costs (see 2.5 Logistics).



2.6.1.   Additional Personnel Costs (%)
         The additional personnel costs contain the bank's payments to Provisions for Retirement,
         Perks, Special Bonuses and Annual Bonuses, and are calculated on the basis of the salaries.
         The minimum rate of Additional Personnel Costs is 12 % but may be increased at random.



2.6.2.   Employment / Dismissal

         In Personnel you decide on the number of appointments and dismissals of your staff in the
         respective areas. Appointments and dismissals cause costs as you can see in the chart
         below.




BANKING GAME                             Participants' Manual                                    23
         Personnel Data for Period 0
         (The salaries are listed per period in Market Report II, page 2)


                                                                Securities
                                           Lending         Custod.     Asset             Deposit      Money      Miscellan.
                                           business       Accounts Adminis.             business     transfer
          Wages, salaries (SFr.)       75’000.--            65’000.--       85’000.--    70’000.--   55’000.--    68’000.--
          Employment costs (SFr.)      25’000.--            15’000.--       35’000.--    20’000.--   15’000.--    10’000.--
          Dismissal costs (SFr.)         7’500.--            5’000.--       10’000.--     5’000.--    4’000.--     3’500.--
          Training time (hrs)                600                 400             600          300         200          200
          Temporary staff: SFr. 60.-- per hour
          Costs per training day: SFr. 1000.--




2.6.3.   Training
         Depending on the number of training days per employee and per period you improve the
         performance of your staff in Sales and Services. The level of training of your employees will
         be assessed (    see report on OPERATING DATA).



2.6.4.   Acquisition and Service
         If necessary, you may use 20% of your staff at the most for acquisition and service tasks.

         Employment of staff and in-service training has a positive effect on the respective
         business areas. It must be noted, however, that the capacities required might no longer be
         guaranteed if the efforts made in training, acquisition and service are too high. If the volume
         of the respective business areas cannot be covered with full-time staff and overtime (max.
         10% normal working hours), the system automatically recruits temporary staff. Too much
         temporary staff, however, reduces the quality of your service, which may cause
         customers to leave and join the competition.




2.6.5.   Fluctuation
         When employing or dismissing staff please remember that a certain number of staff leave the
         bank during each period. The fluctuation rate to be expected (as a percentage) for the
         following period can be taken from the report (OPERATING DATA).

         The fluctuation rate is affected by the amount of Additional Personnel Costs, Training
         Schemes, Overtime, and the number of Temporary Staff.




BANKING GAME                                        Participants' Manual                                               24
2.7.   Decision-Taking Form IV: Logistics




        LOGISTICS
                                                    P0       P1      P2       P3       P4
        Investments in Automation    (Mio. SFr.)    0,0




       Productivity can be improved by making investments in automation. Investments reduce the
       number of working hours (see Report OPERATING DATA) required for administration in the
       individual departments and thus result in saving personnel and/or in reducing personnel
       costs.

       Investments are activated on the balance sheet under the heading "Other Assets" and are
       debited on the net book value with 5% per period.

       The level of automation (see Report OPERATING DATA - Automation Index), which depends
       on the amount of investments made, is likely to have the following effects according to
       economic surveys:


         Cumulative Investments          Level of Automation       Change in Working Hours
              (Mio. SFr.)                       (Index)                 Required for
                                                                       Administration
                      800                           75                       + 10 %
                     1000                           80                        +5%
                     1200                           85                          0%
                     1300                           90                         -5%
                     1450                           95                       - 10 %
                     1700                          100                       - 12 %
                     2000                          105                       - 13 %




BANKING GAME                          Participants' Manual                                  25
2.8.     Decision-Taking Form V: Financial Management


          Decision Taking Form V                                                Bank: .......
                                              Banking Game
          FINANCIAL MANAGEMENT
                                                          P0        P1        P2        P3      P4
          Dividend (% of nom. value)           %           0,0
          Capital increase                (Mio. SFr.)          0




         In the Banking-Game financial management means taking decisions in the areas Dividend
         Distribution and Budgeting of Capital Resources (share capital increase).



2.8.1.   Dividend Distribution
         By deciding to pay dividends the profits of the previous period can be distributed. You
         enter the desired distribution as the percentage of the share capital in the respective space.
         The dividend and the allocation to legal reserves (if a super dividend is distributed) must not
         exceed the profits. The debiting of the dividend distribution must comply with the Swiss
         Federal Code of Obligations in the period of the decision.



         Example of Dividend Distribution
         Profit of previous period:                                200 million SFr.
         Budgeted dividend:                                                    8%
         Share capital                                             800 million SFr.

         In this case it must be noted that if the dividend to be distributed exceeds 5% (super
         dividend), one tenth of the super dividend must be allocated to legal reserves.

         Dividend 8 % of 800 million share capital                 64,0 million SFr.
         Allocation to legal reserves
          8 % - 5 % = 3 % super dividend
          3 % of 800 million share capital = 24 million
          10 % of 24 million                                        2,4 million SFr.
         Net profit required                                       66,4 million SFr.


         The dividend policy applied by the bank is to be shareholder friendly but should also consider
         aspects of security. The dividend policy affects prices at the stock exchange. Dividends that
         are not distributed are allocated to the account Other Reserves and therefore increase the
         liquid funds of the bank (important for capital resources regulations according to the Banking
         Law,      see Capital Adequacy Report).




BANKING GAME                               Participants' Manual                                      26
2.8.2.   Capital Increase
         Every bank can issue new shares by means of capital increase. The issue price is 80 % of
         the stock-exchange price of the shares computed by the model in the previous period.
         (    see Market and Competition Report).



         Example of computation of share capital increase
         Capital increase:      100 million SFr. by issuing 500’000 shares nominal value
                                SFr. 200.--

         Share price (prev. period):   SFr. 600
         Issue price:                  80 % of the share price of the previous period
                                       SFr. 480 (80 % of SFr. 600)



         Increase in capital resources due to increase in capital

         Increase in share capital (500’000 x 200.--)        100 Mio SFr.
         + issuing premium (500’000 x 280.--)                140 Mio SFr.
         Total increase in capital resources                 240 Mio SFr.

         The issuing premium is to be allocated to legal reserves.

         A share capital increase can be carried out at any time. An increase in capital is necessary,
         however, if the required capital resources no longer cover the risks (            see Capital
         Adequacy Report). If the capital increase exceeds the legal regulations, it will also
         affect the profitability of the capital resources, which in turn will have a negative effect on
         the stock exchange price.




BANKING GAME                               Participants' Manual                                      27
2.9.    Decision taking form V – part II: holdings

        The pre-calculation of the participants‘ version of the simulation will give you information
        about the maximum amount of the different holding types. The volume of these holdings
        types depends on the purchases and sales of the other banks. If too many banks want to buy
        a certain holding, the system will divide up these holdings to the banks in proportion to the
        amount each bank wanted to buy



        Decision-Taking Form V                                                                           Bank: ......

                                          Banking Game
        HOLDINGS
                                            P0     P1      P2      P3      P4     P5      P6

Holding Type A           + / - Mio Sfr.              0
Holding Type B           + / - Mio Sfr.              0
Holding Type C           + / - Mio Sfr.              0
Holding Type D           + / - Mio Sfr.              0
Holding Type E           + / - Mio Sfr.              0
Holding Type F           + / - Mio Sfr.              0




2.9.1. Holdings
        With the module holdings you may purchase holdings. Holdings may carry a greater or
        larger element of risk but also promise good profits. The holdings and their development will
        be described in special economic scenarios.



2.9.2. Report holdings
        With this report you get an overview of the different holdings which your bank possesses.

        Dividends and profits and losses on the market value will be booked in the profit and loss
        account. Note that the holdings have a lasting effect on the capital resources required.




BANKING GAME                              Participants' Manual                                      28
2.2.   The Management Information System


2.3.   The Initial Balance Sheet

       ┌──────────────────────────────────────────────────────────────────────────────┐
       │ BANKING GAME                                    Copyright (c) 1999 by UNICON │
       │                                                 Bank 1             Period 0 │
       │ EDUTRAIN AG - CH 8048 ZURICH                    V 8.0        Date 8. 6.1999 │
       ├──────────────────────────────────────────────────────────────────────────────┤
       │                                                                              │
       │                          B A L A N C E   S H E E T                           │
       │                                                                              │
       ├───────────────────────────────────────┬──────────────────────────────────────┤
       │ ASSETS                        Mio SFr │ LIABILITIES                  Mio SFr │
       ├───────────────────────────────────────┼──────────────────────────────────────┤
       │ Liquidity                        2619 │ Due to banks                         │
       │                                       │ on demand                        600 │
       │ Claims in resp. of MM Paper       500 │   of which bridging credit         0 │
       │                                       │ at term                         4500 │
       │ Due from banks                        │                                      │
       │ on demand                         850 │ Due to customers                     │
       │ at term                          4600 │ saving deposits                10896 │
       │                                       │ investment deposits             3597 │
       │ Due from customers                    │                                      │
       │ Secured by mortgage              4494 │ Due to customers, other              │
       │ Other security                   6072 │ on demand                       3791 │
       │ Unsecured                        7540 │ at term                         8077 │
       │                                       │                                      │
       │ Mortgage claims                       │ Medium-term notes               5388 │
       │ variable interest rate           7007 │                                      │
       │ fixed interest rate              5297 │ Long-term bonds                 2100 │
       │                                       │ of which subordinated              0 │
       │ Securities trading portfolio          │                                      │
       │   Domestic shares                 500 │ Write-downs and provisions       810 │
       │   Foreign shares                  500 │                                      │
       │   Domestic bonds                  500 │ Share capital                    800 │
       │   Foreign bonds                   500 │ Legal reserves                   750 │
       │                                       │ Other reserves                   975 │
       │ Holdings                            0 │                                      │
       │                                       │                                      │
       │ Physical assets                   570 │                                      │
       │                                       │                                      │
       │ Other physical assets             680 │                                      │
       │                                       │                                      │
       │ Other assets                      230 │                                      │
       │                                       │                                      │
       │ Annual loss                         0 │ Net result for year              175 │
       ├───────────────────────────────────────┼──────────────────────────────────────┤
       │ BALANCE SHEET TOTAL             42459 │ BALANCE SHEET TOTAL            42459 │
       └───────────────────────────────────────┴──────────────────────────────────────┘

       ┌───────────────────────────────────────┬─────────────┬──────────────┬─────────┐
       │ SURVEY OF                             │   Volume    │ Due date     │Interest │
       │ Mortgage claims fixed rate            │ (Mio.SFr) │ in Period      │    (%) │
       ├───────────────────────────────────────┼─────────────┼──────────────┼─────────┤
       │ Period -4                             │     1113    │       1      │   5,00 │
       │ Period -3                             │     1285    │       2      │   5,25 │
       │ Period -2                             │     1001    │       3       │  5,75 │
       │ Period -1                             │      776    │       4      │   6,00 │
       │ Period 0                              │     1122    │       5      │   6,75 │
       ├───────────────────────────────────────┴─────────────┴──────────────┴─────────┤
       │                                 TOTAL:      5297           AVERAGE:    5,72 │
       └──────────────────────────────────────────────────────────────────────────────┘
       ┌───────────────────────────────────────┬─────────────┬──────────────┬─────────┐
       │ SURVEY OF                             │   Volume    │ Due date     │Interest │
       │ Medium term notes                     │ (Mio.SFr) │ in Period      │    (%) │
       ├───────────────────────────────────────┼─────────────┼──────────────┼─────────┤
       │ Period -4                              │     869    │       1       │  4,25 │
       │ Period -3                             │     1031    │       2      │   4,50 │
       │ Period -2                             │     1320    │       3      │   5,00 │
       │ Period -1                              │     960    │       4       │  5,25 │
       │ Period 0                              │     1208    │       5      │   6,00 │
       ├───────────────────────────────────────┴─────────────┴──────────────┴─────────┤
       │                                 TOTAL:      5388           AVERAGE:    5,05 │
       └──────────────────────────────────────────────────────────────────────────────┘




BANKING GAME                         Participants' Manual                                 29
2.3.1.   Comments on Balance-Sheet Items


         Assets


         Liquidity
         This balance-sheet item represents the bank funds immediately available. The Giro
         accounts are deposits with clearing banks and the National Bank. According to the Liquidity
         regulations of the Banking Law a minimum deposit of several hundred million SFr. must be
         available (     see Liquidity Statement "Cash Liquidity"). Good cash management allows you
         to limit these non-interest-bearing funds to a minimum.



         Claims in respect of Money Market Paper
         In the Banking Game money market papers such as Bankers Acceptances, Commercial
         Papers and Certificates of Deposit fall into this category. You acquire them by draining liquid
         funds when deciding on the volume on Decision-Taking Form II.




         Due from Banks

         -   on demand
             Credit Deposits (Nostro accounts) with other banks which are available on call. As
             a rule, Nostro accounts contain non-interest-bearing credit balances in foreign currency
             with correspondent banks through which the bank handles payments.

         -   at Term

             Balances with other banks at fixed dates. This very important business includes above
             all fixed investments of liquid funds with other banks and thus improves its own earning
             power.



         Due from customers
         -   secured against real estate
             This includes all real estate and construction loans as well as working capital loans
             secured against real estate. Firm underwritings of mortgage claims and of mortgage deed
             pledges qualify as security against real estate.

         -   with other forms of security
             This covers all forms of security other than real estate. It includes securities, guarantees
             and the assignment of receivables.

         -   unsecured
             This position includes loans granted without the usual security and loans whose security is
             rendered formally or materially invalid.




BANKING GAME                                Participants' Manual                                      30
     Mortgages
     Loans which are secured against property as per the Civil Code. The loan is secured against
     a right of lien (mortgage, mortgage note or agricultural mortgage note) in respect of the
     property. The banks finance their mortgage lendings mainly from long-term savings
     deposits and medium-term notes. The interest margin in this area of business is rather
     narrow.

     -   variable-rate
         Under the terms of a variable-rate mortgage, the bank can adjust the interest rate to
         reflect changing circumstances on the money and capital markets subject to a three-
         month period of notice.

     -   fixed-rate
         In the case of fixed-rate mortgages, the interest rate is set for the entire duration of the
         loan at the time the credit is granted. Fixed-rate mortgage agreements cannot be
         terminated. In practice, the customer may choose a term of between two and ten years.
         The bank then immediately refinances the amount lent via the capital market for the same
         term.

         For the purposes of the Banking Game, fixed-rate mortgages always have a term of five
         years.



     Securities trading portfolio
     Securities and precious metal holdings from the bank’s own funds which have been
     invested on the basis of the investment strategy outlined in ‘decision-taking form II’. Details of
     the valuation can be found in the ‘shares/bonds’ position summary.


     Physical assets
     Property which the bank uses for its own purposes or leases to third parties. Each period, the
     balance sheet value of bank premises falls by the amount assigned for depreciation.
     Depreciation is 5% per period and refers to the year-end book value.


     Other physical assets
     This balance sheet position includes such items as furnishings. Investments in plant and
     machinery as per decision-taking form IV are also booked under ‘other physical assets’.
     Depreciation is 5% per period and refers to the year-end book value.


     Other assets
     Coupon holdings, foreign notes and coins and the balance from internal transactions are
     recorded under ‘other assets’. This item remains unchanged for the purposes of the Banking
     Game.




BANKING GAME                            Participants' Manual                                        31
     Liabilities


     Due to banks

     -   on demand
         Foreign banks’ holdings in Swiss francs for funds transfer purposes. If you allow
         your bank’s liquidity to fall below an acceptable level, a bridging loan will automatically be
         granted at a higher rate of interest.

     -   at term
         Fixed-term deposits held by other banks. Items booked under ‘day-to-day liabilities’
         and ‘fixed-term liabilities’ are redistributed each period (in line with due dates and further
         market growth). The volume of fixed-term liabilities is determined solely by your
         interest rate decisions.



     Due to customers
     -   savings deposits
         Savings deposits are deposits which can in any way be characterised by the term
         ‘savings’, and may only be accepted by banks which publish their accounts. Savings
         deposits also enjoy legal privileges in the event of bankruptcy.

     -   investment deposits
         Types of customer deposits used for private payment transactions, e.g. salary and private
         accounts. Withdrawals from these accounts are subject to fewer restrictions than savings
         accounts.



     Due to customers, other

     -   on demand
         Current account assets of commercial and private customers which can be
         accessed immediately and which therefore accrue only minimal interest or none at
         all. Customers use these accounts primarily to carry out payment transactions.

         Although the volume of assets in current accounts tends to fluctuate wildly, these
         fluctuations are, for the most part, offset by the large number of accounts. Overall,
         therefore, we can assume that average sight deposits will remain relatively stable
         (sediment theory).

     -   at term
         Time deposits held by commercial and private customers for between 1 and 360
         days.

         As most banks require a minimum investment in excess of SFr. 100,000 or the equivalent
         in another currency, this heading covers larger sums invested by customers for short
         periods of time at a high rate of return. Customers are therefore strongly influenced by
         relative interest-rate advantages or disadvantages.




BANKING GAME                            Participants' Manual                                        32
     Bank-issued Medium-Term Notes
     Fixed-time medium-term certificates of indebtedness. Your bank only issues notes with a
     life of 5 years. Buyers of such bonds strongly react to changes in interest rates.

     The survey of medium-term notes shows in which period the bonds were issued, the volume,
     the due dates as well as the average interest rate.



     Bond Loans
     Long-term funds for financing lending business. The duration of the bonds in the Banking
     Game is 12 periods. 140 million SFr. are due per period from previous periods.



     Subordinated Bonds
     Subordinated means that, in case of the bank's bankruptcy, the creditors' claims will not be
     paid until all the five ranks of the collocation plan are satisfied in full.

     The bank may consider subordinated bonds of up to maximum 25% of the capital required by
     the evidence of collateral security, which is necessary for the fulfilment of the capital
     regulations according to the Banking Law (see comments Capital Adequacy Report).

     The interest rate for subordinated bonds is 1/2 % higher than that of ordinary bonds.



     Write-downs and provisions
     Mainly provisions are to be found under this balance-sheet item. This item remains
     unchanged during the course of the seminar.



     Share Capital
     The share capital of the bank amounts to 4’000’000 bearer shares of SFr. 200.-- nominal
     value. The capital may be changed by means of an increase in capital.



     Legal Reserves and Other Reserves
     Reserves whose accumulation and use is partly stipulated by the Banking Law and/or the
     Swiss Federal Code of Obligations.

     The net profit / loss changes these items depending on the distribution of the dividend. The
     losses in one period are listed in the profit and loss account and are set off against the
     balance-sheet item Other Reserves. Therefore, no values are shown under the heading "Net
     Losses".




BANKING GAME                           Participants' Manual                                   33
2.4.   Profit and Loss Account


       ┌─────────────────────────────────────────────────────────────────────────────────┐
       │ BANKING GAME                                       Copyright (c) 1999 by UNICON │
       │                                                    Bank 1            Period    0 │
       │ EDUTRAIN AG - CH 8048 ZURICH                       V 8.0        Date 8. 6.1999 │
       ├─────────────────────────────────────────────────────────────────────────────────┤
       │                                                                                  │
       │   P R O F I T   A N D   L O S S   A C C O U N T / I N D E X     F I G U R E S    │
       │                                                                                  │
       ├─────────────────────────────────────────────────────────────┬─────────┬─────────┤
       │ PROFIT AND LOSS ACCOUNT                             Mio SFr │prev. per│ period │
       ├─────────────────────────────────────────────────────────────┼─────────┼─────────┤
       │   Interest and discount income                              │         │    2387 │
       │ + Credit commissions                                        │         │       95 │
       │ + Interest and dividend income from financial assets        │         │     105 │
       │ - Interest expense                                          │         │    1831 │
       ├─────────────────────────────────────────────────────────────┼─────────┼─────────┤
       │ = Income from interest business                             │         │     755 │
       ├─────────────────────────────────────────────────────────────┼─────────┼─────────┤
       │   Securities and investment commissions                     │         │     674 │
       │ + Total income of bond issue business                       │         │        0 │
       │ - Commission expense                                        │         │      67 │
       ├─────────────────────────────────────────────────────────────┼─────────┼─────────┤
       │ = Commission income                                         │         │     606 │
       ├─────────────────────────────────────────────────────────────┼─────────┼─────────┤
       │   Income from trading                                       │         │        0 │
       ├─────────────────────────────────────────────────────────────┼─────────┼─────────┤
       │ - Staff costs                                               │         │     466 │
       │ - Additional personnel costs                                │         │       56 │
       │ - Other personnel costs                                     │         │        0 │
       │ - Property, equipment and administrative costs              │         │     214 │
       ├─────────────────────────────────────────────────────────────┼─────────┼─────────┤
       │ = Operating expenditure                                     │         │     736 │
       ├─────────────────────────────────────────────────────────────┼─────────┼─────────┤
       │ GROSS PROFIT                                                │         │     625 │
       ├─────────────────────────────────────────────────────────────┼─────────┼─────────┤
       │ - Write-downs on fixed assets                               │         │     200 │
       │ - Write-downs, provisions and losses                        │         │     192 │
       │ + Income from holdings                                      │         │        0 │
       │ + Extraordinary income                                      │         │        0 │
       │ - Extraordinary expenditure                                 │         │        0 │
       │ - Tax                                                       │         │      58 │
       ├─────────────────────────────────────────────────────────────┼─────────┼─────────┤
       │ Net Result for Year                                         │         │     175 │
       └─────────────────────────────────────────────────────────────┴─────────┴─────────┘

       ┌──────────────────────────────────┬──────────────────────────────┬───────────────┐
       │ INDEX FIGURES                    │   Profit / Loss    (Mio SFr) │           315 │
       │ Cumulative end of periode 0      │   Planning quality (Factor) │           8,97 │
       │                                  │   Succes rate      (Mio SFr) │           404 │
       ├──────────────────────────────────┼──────────────┬───────┬───────┼───────────────┤
       │                                  │   DEVIATION │Requir.│Actual │ Deviations     │
       │                                  │   INDEX FIG │values │values │ absol.│ in % │
       ├──────────────────────────────────┼──────────────┼───────┼───────┼───────┼───────┤
       │ Interest margin (%)       1,78   │   Bal.sh.tot.│ 42500│ 42459│      -41│   -0,1│
       │ Return on equity (%)       6,9   │   Net profit │    175│    175│      0│   -0,1│
       │ Incr.of bal.sh.tot.(%)     9,9   │              │       │       │       │       │
       ├──────────────────────────────────┴──────────────┼───────┴───────┴───────┴───────┤
       │ Dividend (% of nominal value)            0,0    │                               │
       │ Share price          (SFr)                500   │                               │
       │ P / E ratio                              11,4   │                               │
       └─────────────────────────────────────────────────┴───────────────────────────────┘




BANKING GAME                          Participants' Manual                                    34
2.4.1.   Comments on Profit and Loss Account


         Income from interest business
         Income from interest business is defined as the positive balance between interest received
         and interest paid. Banks aim to generate this income by lending available capital resources
         and customer deposits to third parties, by acquiring financial assets, and through trade
         finance.

         Interest and discount income
         Interest which the bank earns from lending business and income from bill collection.

         Credit commissions
         Commissions from credit business, which form part of interest earnings.

         Interest and dividend income from securities trading
         Interest and dividends which the bank receives on assets (nostro holdings) purchased on
         decision-taking form II.

         Interest expenditure
         Interest which the bank pays on customer deposits.

         Income from interest business
         Income from interest business is made up of interest and discount income from lending
         business plus interest and dividend income from securities trading minus interest expenditure
         on customer deposits. The resultant interest margin, expressed as a percentage (income
         from interest business x 100  total assets), is an important earnings indicator for your bank.


         Commission income
         Securities and investment commissions
         Commissions on customer securities business turnover. The banks decide their commission
         charges using decision-taking form II. Customer securities business turnover is calculated as
         follows:

             turnover from custodianship business (see ‘market data’ report)
         +   volume of assets under management (see shares and bonds report)
         +   asset reallocation fees (see shares and bonds report)

         Total income bond issue business
         Income from bond issue business if the bank underwrites a bond issue by offering the
         highest underwriting price.

         Commission expense

         Commission expense is equal to 0.1% of customer securities business turnover.


         Income from trading
         Trading covers all transactions where the bank buys or sells foreign exchange, precious
         metals, money market positions, securities or derivatives on its own account, thereby
         accepting the attendant risk, with a view to earning income by anticipating price or interest-
         rate movements, by closing out or realigning positions and by exploiting differentials between
         bid and offer rates.

         In the Banking Game, this is where price gains and losses on investments and/or currencies
         are itemised, along with hedging costs for the bank’s own securities portfolio.


BANKING GAME                               Participants' Manual                                      35
     Staff costs
     Staff costs include all expenditure on the bank’s staff, management and directors.
     Number of employees x wages and salaries according to the MARKET RESEARCH
     REPORT, page 2.


     Additional Personnel Costs

     The cost of old-age pensions for staff members amount to at least 12 % of the Staff Costs.
     The rate is determined by the banks on Decision-Taking Form IV and may be adjusted above
     the minimum rate.


     Other Personnel Costs
     Include the costs caused by employing and dismissing staff, overtime, temporary staff and in-
     service training.



     Property, equipment and administrative costs
     Rental, maintenance of office and operating equipment, travel allowances, insurance
     premiums, etc. each cost 0.8% of total assets. Advertising overheads and the cost of the
     market and competition report (SFr. 3 million) are also charged to this heading. If the bank
     underwrites a bond issue, the fixed costs of 10 Mio SFr. And the variable costs of 1 % of the
     issue amount are charged to this heading.



     Gross profit
     Gross profit is calculated as follows:

         Income from interest business
     +   Commission income
     +   Income from trading
     -   Personnel and administrative costs
     =   Gross profit



     Write-downs on fixed assets
     Contain the depreciations on the physical assets (bank premises) and other assets with
     5% of the net book value



     Write-downs, provisions and losses
     This entry deals with losses incurred on credit business. The extent of the losses will depend
     on the volume of business, fluctuating within a range of 0.2% to 2% according to the position
     in question and the general economic situation.




BANKING GAME                            Participants' Manual                                    36
         Extraordinary income
         Extraordinary income generally covers all non-operating income and revenue not relating to
         the period in question, primarily:
         - realised profits on the sale of equity participations and physical assets
         - revaluations of fixed assets up to the legally permissible maximum
         - write-backs of undisclosed reserves and reserves for general bank risks

         For the purposes of the Banking Game, this item is prescribed by the organiser and remains
         unchanged.



         Extraordinary Expenditure
         In the Banking Game this position can only be influenced by the organiser.



         Tax
         Amount to 25 % of the net profits before tax.



2.4.2.   Explanations of bond issue business
         Information regarding the bonds being issued in this period

         Underwriting issue by bank(s)          Bank(s) offering the highest underwriting price
         Income from bond issues (Mio SFr)      Commission for the bonds underwritten
         Issue Amount (Mio SFr)                 Volume issued by the borrower
         Subscription quota (%)                 Percentage of issue amount subscribed by the clients
         Underwriting price (%)                 Price at which the bank(s) has (have)underwritten the
                                                issue
         Discount (%)                           Difference between 100 % and the price at which the
                                                banks have to sell the bonds which were not sub-
                                                scribed by the clients



2.4.3.   Comments on Index Figures

         Profit / Loss (million SFr.)
         This item shows you the cumulative result of profits and losses from the previous periods
         and the current period (incl. credits for planning bonuses in this period).



         Planning Quality (Factor)
         The deviations from the planned balance-sheet total entered on Decision-Taking Form I and
         from the net profits will be converted using a planning quality factor.

         This factor was 8.98 in period 0. One planning bonus corresponds to a credit of 10 million
         SFr. and will be added to the cumulative result of profits and losses in the respective period.



         Success Rate

BANKING GAME                               Participants' Manual                                      37
         The success rate is computed on the basis of the above as follows:

                        Cumulative profits / losses                   million SFr.     315
                      + Planning quality (8,53 x 10 million)          million SFr.      89
                      = Success rate (rounded)                        million SFr.     405



         Interest Margin
         The interest margin (%) is computed as follows:

             ((Income from interest business) / balance-sheet total) x 100



2.4.4.   Share Price (SFr.)
         A share price is determined for each bank in the game, which will provide information about
         the quality of the bank. The following factors, bearing different weighting, will be considered
         for the computation of the share prices:

                                                             Balance sheet total
                                                             Net profit
                                                             Net loss
                                                             Bridging credit (from SFr. 1'000 Mio.)
                                                             Performance-Index (PI)
                                                             Planning quality factor
                                                             Training
                                                             Advertising
                                                             Dividend
                                                             Profitability of capital resources
                                                             Deficit capital resources
                                                             Share price previous period
                                                             Fluctuation rate




2.4.5.   p/e ratio
         The p/e ratio shows the relationship of the share price to the net profit of the share. A p/e
         ratio of 10 states that the price of the share is ten times as high as the earnings per share,
         i.e. it takes ten years to achieve the value of the share. Rule of thumb: a low p/e ratio may be
         regarded as positive; note, however, that a low p/e ratio indicates a drop in earnings to be
         expected.

         Calculation p/e ratio period 0
         Nominal value                                   200
         Share capital                               800 Mio
         Number of shares                         4’000’000
         Net profit                          175 million SFr.

                                             net profit                    175
         Net profit per share                number of shares               4        =SFr. 43.75

         p/e ratio                           share price                    500
                                             profit per share              43.75     = 11,4




BANKING GAME                               Participants' Manual                                        38
2.5.   Statement of Flow of Funds

       ┌──────────────────────────────────────────────────────────────────────────────┐
       │ BANKING GAME                                    Copyright (c) 1999 by UNICON │
       │                                                 Bank 1               Period 0 │
       │ EDUTRAIN AG - CH 8048 ZURICH                    V 8.0         Date 8. 6.1999 │
       ├──────────────────────────────────────────────────────────────────────────────┤
       │                                                                                │
       │              S T A T E M E N T    O F  F L O W   O F    F U N D S              │
       │                                                                                │
       ├──────────────────────────────────────────┬────────┬────────┬────────┬────────┤
       │ All values in Mio SFr                    │ Outflow│ Inflow │ Balan.I│Balan.II│
       ├──────────────────────────────────────────┼────────┼────────┼────────┼────────┤
       │ FLOW OF FUNDS FROM PR. AND LOSS ACCOUNT │         │         │         │    375 │
       │ Net profit / loss                        │      0 │     175 │    175 │         │
       │ ± Succes rates of securities valuation   │      0 │       0 │       0 │        │
       │ ± Succes rate of holdings valuation      │      0 │       0 │       0 │        │
       │ Write-downs on fixed assets              │      0 │     200 │     200 │        │
       │ Distribution of dividend (prev. year)    │      0 │       0 │       0 │        │
       │                                          │        │         │         │        │
       ├──────────────────────────────────────────┼────────┼────────┼────────┼────────┤
       │ FLOW OF FUNDS FROM CAPITAL INCREASE      │        │         │         │      0 │
       │ Share capital (nominal value)            │      0 │       0 │       0 │        │
       │ Issuing premium                          │      0 │       0 │       0 │        │
       │                                          │        │         │         │        │
       ├──────────────────────────────────────────┼────────┼────────┼────────┼────────┤
       │ FLOW OF FUNDS FROM FIXED ASSETS          │        │         │         │      0 │
       │ Other physical assets                    │      0 │       0 │       0 │        │
       │                                          │        │         │         │        │
       ├──────────────────────────────────────────┼────────┼────────┼────────┼────────┤
       │ FLOW OF FUNDS FROM BANKING BUSINESS      │        │         │         │   -900 │
       │ Due to banks on demand                   │    500 │     600 │    100 │         │
       │              at term                     │   4300 │   4500 │     200 │         │
       │ Due to customers, saving deposits        │   1728 │    2299 │    571 │         │
       │                   investment deposits    │    491 │     813 │    322 │         │
       │ Due to customers, other: on demand       │    347 │     671 │    324 │         │
       │                          at term         │   3200 │   4877 │    1677 │         │
       │ Medium-term notes                        │    770 │   1208 │     438 │         │
       │ Long-term bonds                          │    140 │     140 │       0 │        │
       │ Due from banks on demand                 │    850 │     630 │   -220 │         │
       │                at term                   │   4600 │   4800 │     200 │         │
       │ Claims in respect of money market paper │     500 │       0 │   -500 │         │
       │ Due from customers secured by mortgage   │   1065 │     857 │   -208 │         │
       │                    other security        │   1811 │    1419 │   -391 │         │
       │                    unsecured             │   2353 │   1675 │    -678 │         │
       │ Mortgage claims with variable interest r.│   1643 │   1341 │    -302 │         │
       │                 with fixed interest rate │   1122 │     689 │   -433 │         │
       │ Securities trad. portf. Domestic shares │     500 │       0 │   -500 │         │
       │                         Foreign shares   │    500 │       0 │   -500 │         │
       │                         Domestic bonds   │    500 │       0 │   -500 │         │
       │                         Foreign bonds    │    500 │       0 │   -500 │         │
       │ Holdings                                 │      0 │       0 │       0 │        │
       │                                          │        │         │         │        │
       ├──────────────────────────────────────────┼────────┼────────┼────────┼────────┤
       │ Bridging Credit I                        │        │         │         │      0 │
       ├──────────────────────────────────────────┼────────┼────────┼────────┼────────┤
       │ SURPLUS / DEFICIT FLOW OF FUNDS          │        │         │         │   -525 │
       ├──────────────────────────────────────────┼────────┼────────┼────────┼────────┤
       │ Initial balance of liquidity             │        │         │         │   3144 │
       │ Final balance of liquidity               │        │         │         │   2619 │
       └──────────────────────────────────────────┴────────┴────────┴────────┴────────┘




BANKING GAME                          Participants' Manual                                  39
2.5.1.   Comments on Flow of Funds
         Banks with total assets of SFr 100 million or more and a large volume of balance sheet
         business must also produce a statement of flow of funds as part of their annual accounts.

         The purpose of this information is to identify inflows and outflows of funds as a means of
         accounting for changes in liquidity during the year under review. As a minimum requirement,
         the statement of flow of funds must contain the following categories of data:

         a.    cash flows (self-financing)
         b.    flows of funds from equity capital transactions (capital increases)
         c.    flows of funds from fixed asset operations (capital expenditure)
         d.    flows of funds from banking business (lending/deposit business)

         For the purposes of the Banking Game, positions in the statement of flow of funds are
         defined as follows:


         Outflow               Inflow                   Balance I                        Balance II
         Loss of               Influx of                Difference between               Total funds
         liquid funds          liquid funds             outflow and inflow


         N.B. The statement of flow of funds should not be confused with the statement of
              source and applications of funds.


         Bridging loan I

         If, in the course of the seminar, inflows of customer deposits to your bank should fall to an
         unacceptable level, a bridging loan will automatically be granted at a higher rate of interest.




BANKING GAME                               Participants' Manual                                        40
  2.6.     Operating Data

┌─────────────────────────────────────────────────────────────────────────────────────────────────────────┐
│ BANKING GAME                                                                Copyright (c) 1999 by UNICON │
│                                                                             Bank 1             Period 0 │
│ EDUTRAIN AG - CH 8048 ZURICH                                                V 8.0        Date 8. 6.1999 │
├─────────────────────────────────────────────────────────────────────────────────────────────────────────┤
│                                                                                                          │
│                                       O P E R A T I N G   D A T A                                        │
│                                                                                                          │
├─────────────────────────────────────────────────────────────────────────────────────────────────────────┤
│                                                                                                          │
│ OPERATING DATA                                                                                           │
│                                                                                                          │
├───────────────────────────┬─────────────┬───────────────────────────┬─────────────┬─────────────┬───────┤
│ PERSONNEL                 │ Lending      │         Securities        │ Deposit     │ Money       │ Others│
│                           │ business     │ Custodiansh.     Asset    │ business    │ transfer    │       │
│                           │              │   business │ administr. │               │             │       │
├───────────────────────────┼─────────────┼─────────────┼─────────────┼─────────────┼─────────────┼───────┤
│ Initial number of staff   │      2070    │      1090   │       205   │      1165   │      1005   │       │
│ Employment/Dismissal      │         0    │         0   │         0   │         0   │         0   │       │
│ Fluctuation               │          0   │          0   │         0  │         0   │         0   │       │
│ Final number of staff     │      2070    │      1090   │       205   │      1165   │      1005   │   1260│
├───────────────────────────┼─────────────┼─────────────┼─────────────┼─────────────┼─────────────┼───────┤
│ Fluctuation next period   │       269    │       142   │        27   │       151   │       131   │       │
│ Rate of fluct. next period│      13,0    │      13,0   │      13,0   │      13,0   │      13,0   │       │
├───────────────────────────┼─────────────┼─────────────┼─────────────┼─────────────┼─────────────┼───────┤
│ Hours available in 1000 h │    3601,8    │    1896,6   │     356,7   │    2027,1   │    1748,7   │ 2192,4│
│ Deployment of personnel   │              │              │            │             │             │       │
│ - Acquisition             │       0,0    │       0,0    │      0,0   │             │             │       │
│ - Service                 │       0,0    │       0,0    │      0,0   │       0,0   │       0,0   │       │
│ Hours available daily bus.│    3601,8    │    1896,6   │     356,7   │    2027,1   │    1748,7   │ 2192,4│
│ Hours needed daily bus.   │    3579,3    │    1853,8   │     332,6   │    2009,8   │    1724,2   │ 1913,3│
│ Overtime                  │       0,0    │       0,0    │      0,0   │       0,0   │       0,0   │    0,0│
│ Temporary staff           │       0,0    │       0,0   │       0,0   │       0,0   │       0,0   │    0,0│
├───────────────────────────┼─────────────┼─────────────┼─────────────┼─────────────┼─────────────┼───────┤
│ Level of training         │    poor      │    poor     │    poor     │    poor     │    poor     │       │
├───────────────────────────┼─────────────┼─────────────┼─────────────┼─────────────┼─────────────┼───────┤
│ Level of Job Satisfaction │dissatisfied │dissatisfied │dissatisfied │dissatisfied │dissatisfied │        │
└───────────────────────────┴─────────────┴─────────────┴─────────────┴─────────────┴─────────────┴───────┘
┌─────────────────────────────────────────────────────────────────────────────────────────────────────────┐
│                                                                                                          │
│ LOGISTICS                                                                                                │
├──────────────────────────────────────────────────┬───────┬───────┬───────┬──────────────────────────────┤
│                                                   │Period │ cumul.│ Index │                              │
├──────────────────────────────────────────────────┼───────┼───────┼───────┼──────────────────────────────┤
│ Investments in Automation (Mio. SFr)              │   0,0 │   680 │ 75,0 │                               │
└──────────────────────────────────────────────────┴───────┴───────┴───────┴──────────────────────────────┘




  BANKING GAME                             Participants' Manual                                41
2.6.1.   Comments on the Operating Data

         Personnel

         Under the heading Operating Data Personnel the data concerning the staff situation in the
         individual business areas is shown. The number of staff members multiplied by 1740 hours
         per employee and period reveals the amount of hours available in order to run the game
         (minus the training period for newly employed staff and minus the absences due to in-service
         training measures). The hours taken up with acquiring and looking after staff are deducted
         from the hours available.

         If more hours are required to run the game than are hours available, the missing hours
         are compensated by the staff working overtime in the respective business areas (up to
         maximum 10% overtime). Then temporary staff from employment agencies will be employed
         on an hourly basis. Too much temporary staff affects the quality of service in the respective
         business areas.



         Fluctuation

         By the term fluctuation we mean members of staff who resign their posts with your bank. The
         fluctuation of the current period is computed in the business areas as follows:

          Fluctuation rate (%) prev. period x number of staff members prev. per. = fluctuation

         The fluctuation rate changes according to the personnel policy at your bank. Overtime and a
         lot of temporary staff may cause the morale of the permanent employees at your bank to
         sink, for example (    see level of job satisfaction of employees), and the fluctuation rate will
         rise. On the other hand, increasing additional personnel costs or providing further training
         opportunities may improve staff motivation.

          Level of Job Satisfaction         not motivated / dissatisfied / satisfied / motivated



         Level of Training

         The staff members of the individual business areas are assessed in terms of their level of
         training by independent experts and selected customers in each period. The following marks
         are possible:

                                   poor / sufficient / good / excellent

         The level of training is considerably affected by the expenses for staff training.



         Logistics

         With the help of investments made on Decision-Taking Form IV the bank's automation can
         be enhanced in all business segments. The subsequent savings have an immediate effect on
         the amount of working hours required for administration (      see Report OPERATING
         DATA).

         The automation index may range between 75 and 105.




BANKING GAME                                Participants' Manual                                       42
2.7.     Market Data

┌────────────────────────────────────────────────────────────────────────────────────────────────┐
│ BANKING GAME                                                        Copyright (c) 1999 by UNICON │
│                                                                     Bank 1            Period    0 │
│ EDUTRAIN AG - CH 8048 ZURICH                                        V 8.0        Date 8. 6.1999 │
├────────────────────────────────────────────────────────────────────────────────────────────────┤
│                                                                                                   │
│                                         M A R K E T    D A T A                                    │
│                                                                                                   │
├────────────────────────────────────────────────────────────────────────────────────────────────┤
│                                                                                                   │
│ CUSTOMERS / MARAET (values in million Sfr)                                                TURNOVER│
├──────────────────────────────────────┬──────┬──────┬──────┬──────┬──────┬──────┬──────┬────────┤
│                                       │ HH<45│ HH>45│ HH>65│ SE │ ME │ LE │ PCORP│ Total │
├─────────────────┬────────────────────┼──────┼──────┼──────┼──────┼──────┼──────┼──────┼────────┤
│ Due from        │ sec. by mortgage    │    655│   705│    119│ 1510│   676│   251│   577│    4494 │
│ customers       │ other security      │ 1122│ 1870│       128│ 1395│ 1097│    289│   171│    6072 │
│                 │ unsecured           │ 1731│ 1512│       122│ 2418│   659│   659│   439│    7540 │
│                 │ total               │ 3508│ 4087│       370│ 5322│ 2433│ 1199│ 1187│ 18105 │
├─────────────────┼────────────────────┼──────┼──────┼──────┼──────┼──────┼──────┼──────┼────────┤
│ Mortgage claims │ var. interest rates│ 2874│ 2508│        888│  314│   131│   251│    42│    7007 │
│                 │ fix. interest rates│ 2887│ 1743│        353│   65│    54│   108│    87│    5297 │
│                 │ total               │ 5760│ 4251│ 1241│       379│   185│   359│   129│ 12305 │
├─────────────────┼────────────────────┼──────┼──────┼──────┼──────┼──────┼──────┼──────┼────────┤
│ Due to          │ saving deposits     │ 1688│ 2955│ 6173│        79│     0│     0│      0│ 10896 │
│ customers       │ investment deposits│     439│ 1291│ 1647│     220│     0│     0│      0│   3597 │
│                 │ total               │ 2128│ 4245│ 7821│       299│     0│     0│      0│ 14493 │
├─────────────────┼────────────────────┼──────┼──────┼──────┼──────┼──────┼──────┼──────┼────────┤
│ Due to          │ on demand           │    197│   191│     24│  919│ 1312│    273│   875│    3791 │
│ customers,      │ at term             │ 2271│ 2050│       884│  473│ 1514│    506│   379│    8077 │
│ other           │ total               │ 2468│ 2242│       908│ 1391│ 2826│    779│ 1254│ 11869 │
├─────────────────┴────────────────────┼──────┼──────┼──────┼──────┼──────┼──────┼──────┼────────┤
│ Medium term notes                     │    680│ 1306│ 3048│     109│    98│    65│    82│    5388 │
├─────────────────┬────────────────────┼──────┼──────┼──────┼──────┼──────┼──────┼──────┼────────┤
│ Securities      │ Custodianship b.    │ 3995│ 6390│ 23363│ 4992│ 4791│ 5983│ 6661│ 56175 │
├─────────────────┴────────────────────┴──────┴──────┴──────┴──────┴──────┴──────┴──────┴────────┤
│                                                                                                   │
│ A = Number of accounts                       V = Average value per account in 1000 SFr            │
├──────────────────────────────────────┬──────┬──────┬──────┬──────┬──────┬──────┬──────┬────────┤
│                                       │ HH<45│ HH>45│ HH>65│ SE │ ME │ LE │ PCORP│Accounts│
├─────────────────┬────────────────┬───┼──────┼──────┼──────┼──────┼──────┼──────┼──────┼────────┤
│ Due from        │ sec.by mortgage│ A │ 25752│ 21571│ 1232│ 8207│ 1539│        205│   513│ 59019 │
│ customers       │                │ V │      25│    33│     97│  184│   439│ 1226│ 1124│           │
│                 │ other security │ A │ 31309│ 36394│ 1560│ 9367│ 1976│        156│   208│ 80970 │
│                 │                │ V │      36│    51│     82│  149│   555│ 1850│    822│         │
│                 │ unsecured      │ A │ 48209│ 34213│ 1067│ 11739│ 1601│       320│   215│ 97364 │
│                 │                │ V │      36│    44│    114│  206│   412│ 2059│ 2042│           │
├─────────────────┼────────────────┼───┼──────┼──────┼──────┼──────┼──────┼──────┼──────┼────────┤
│ Mortgage        │ variable       │ A │ 5625│ 6136│ 4347│ 1023│         256│   123│     51│ 17561 │
│ claims          │ interest rate │ V │      511│   409│    204│  307│   511│ 2044│    817│         │
│                 │ fixed          │ A │ 5675│ 4283│ 2891│        214│   107│    53│   107│ 13330 │
│                 │ interest rate │ V │      509│   407│    122│  305│   509│ 2033│    814│         │
├─────────────────┼────────────────┼───┼──────┼──────┼──────┼──────┼──────┼──────┼──────┼────────┤
│ Due to          │ saving deposits│ A │ 88193│ 77169│ 99345│ 5544│        0│     0│      0│ 270251 │
│ customers       │                │ V │      19│    38│     62│   14│     0│     0│      0│        │
│                 │ investment     │ A │ 43029│ 50756│ 32272│ 10757│       0│     0│      0│ 136814 │
│                 │ deposits       │ V │      10│    25│     51│   20│     0│     0│      0│        │
├─────────────────┼────────────────┼───┼──────┼──────┼──────┼──────┼──────┼──────┼──────┼────────┤
│ Due to          │ on demand      │ A │ 21870│ 27338│ 2155│ 12911│ 4304│       538│ 1076│ 70192 │
│ customers,      │                │ V │       9│     7│     11│   71│   305│   508│   813│         │
│ other           │ at term        │ A │ 3578│ 2981│ 1193│        596│   954│   239│   239│    9780 │
│                 │                │ V │     635│   688│    741│  794│ 1587│ 2116│ 1587│            │
├─────────────────┴────────────────┼───┼──────┼──────┼──────┼──────┼──────┼──────┼──────┼────────┤
│ Medium term notes                │ A │ 26817│ 32073│ 42764│ 1069│      535│   267│   535│ 104058 │
│                                   │ V │     25│    41│     71│  102│   183│   244│   153│         │
├─────────────────┬────────────────┼───┼──────┼──────┼──────┼──────┼──────┼──────┼──────┼────────┤
│ Securities      │ Custodianship │ A │ 8112│ 8650│ 9737│ 2703│ 1297│           270│   541│ 31310 │
│                 │ business       │ V │      41│    62│    200│  154│   308│ 1847│ 1026│           │
└─────────────────┴────────────────┴───┴──────┴──────┴──────┴──────┴──────┴──────┴──────┴────────┘




BANKING GAME                             Participants' Manual                                 43
2.7.1.   Comments on the Market Data


         Market Data Customer / Market Area (values in million SFr.)
         The first table (page 1 of the report) shows the values of the individual items divided up into
         customer groups.

         Page 2 of the report classifies the data on page 1 according to the number of the accounts
         and the average value per account. In this way you can see the number of accounts and their
         average value per target group and balance-sheet item. This will enable you to have a
         detailed analysis of customers lost or gained within the respective customer groups.




BANKING GAME                               Participants' Manual                                      44
    2.8.     Reference rate system

┌─────────────────────────────────────────────────────────────────────────────────────────────────────────┐
│ BANKING GAME                                                                Copyright (c) 1999 by UNICON │
│                                                                             Bank 1             Period 0 │
│ EDUTRAIN AG - CH 8048 ZURICH                                                V 8.0        Date 8. 6.1999 │
├─────────────────────────────────────────────────────────────────────────────────────────────────────────┤
│                                                                                                          │
│                            REFERENCE RATE SYSTEM - STRUCTURAL CONTRIBUTION                               │
│                                                                                                          │
├────────────────────────────────────────┬────┬───────────┬───────────┬───────────┬───────────┬───────────┤
│                                        │    │ Reference │ Bank's     │ Margin    │   Volume │Interest    │
│ BALANCE SHEET POSITION                 │    │ rate    % │ rate %     │     %     │ (Mio SFr) │contr.(MFr)│
├────────────────────────────────────────┼────┼───────────┼───────────┼───────────┼───────────┼───────────┤
│ Claims in respect of money market p.   │    │    6,75   │     7,00   │    0,25   │     500   │        1 │
├───────────────────────┬────────────────┼────┼───────────┼───────────┼───────────┼───────────┼───────────┤
│ Due from banks        │ on demand      │    │    7,50   │     0,00   │   -7,50    │    850   │      -64 │
│ Due from banks        │ at term        │    │    6,75   │     6,75   │    0,00   │    4600   │        0 │
├───────────────────────┼────────────────┼────┼───────────┼───────────┼───────────┼───────────┼───────────┤
│ Due from customers    │ sec.by mortgage│ CA │    7,50   │     7,50   │    0,00   │    4044   │        0 │
│ Due from customers    │ sec.by mortgage│ FA │    6,40   │     6,50   │    0,10    │    449   │        0 │
│ Due from customers    │ other security │ CA │    7,50   │     8,00   │    0,50   │    2429   │       12 │
│ Due from customers    │ other security │ FA │    6,40   │     7,00   │    0,60    │   3643   │       22 │
│ Due from customers    │ unsecured      │ CA │    7,50   │     8,50   │    1,00   │    3016   │       30 │
│ Due from customers    │ unsecured      │ FA │    6,40   │     7,50   │    1,10   │    4524   │       50 │
├───────────────────────┼────────────────┼────┼───────────┼───────────┼───────────┼───────────┼───────────┤
│ Mortgage claims       │ variable       │ FA │    6,00   │     6,50   │    0,50   │    7007   │       35 │
│ Mortgage claims       │ fixed          │ FA │    6,00   │     5,72   │   -0,28    │   5297   │      -15 │
├───────────────────────┼────────────────┼────┼───────────┼───────────┼───────────┼───────────┼───────────┤
│ Securities trad. port.│ shares         │    │    6,75   │     4,25   │   -2,50    │   1000   │      -25 │
│ Securities trad. port.│ bonds          │    │    6,00   │     6,25   │    0,25   │    1000   │        3 │
├───────────────────────┼────────────────┼────┼───────────┼───────────┼───────────┼───────────┼───────────┤
│ Due to banks          │ on demand      │    │    7,50   │     0,00   │    7,50   │     600   │       45 │
│ Due to banks          │ at term        │    │    6,75   │     6,70   │    0,05   │    4500   │        2 │
├───────────────────────┼────────────────┼────┼───────────┼───────────┼───────────┼───────────┼───────────┤
│ Due to customers      │ saving deposits│    │    6,00   │     5,00   │    1,00   │   10896   │      109 │
│ Due to customers      │ investm. dep. │     │    7,50   │     2,00   │    5,50   │    3597   │      198 │
├───────────────────────┼────────────────┼────┼───────────┼───────────┼───────────┼───────────┼───────────┤
│ Due to customers other│ on demand      │    │    7,50   │     0,25   │    7,25   │    3791   │      275 │
│ Due to customers other│ at term        │    │    6,75   │     6,50   │    0,25    │   8077   │       20 │
├───────────────────────┴────────────────┼────┼───────────┼───────────┼───────────┼───────────┼───────────┤
│ Medium-term notes                      │    │    6,40   │     5,05   │    1,35    │   5388   │       73 │
│ Long-term bonds                        │    │    6,00   │     5,07   │    0,93   │    2100   │       20 │
├────────────────────────────────────────┴────┴───────────┴───────────┴───────────┴───────────┼───────────┤
│                                                           Interest rate contribution   Total │ Σ    791 │
└─────────────────────────────────────────────────────────────────────────────────────────────┴───────────┘
┌─────────────────────────────────────────────────────────────────────────────────────────────────────────┐
│ STRUCTURAL CONTRIBUTION                                                                                 │
├────────────────────────────────────────┬────┬───────────┬───────────────────────┬───────────┬───────────┤
│                                        │    │ Reference │                       │   Volume │Inter. inc.│
│ BALANCE SHEET POSITION                 │    │ rate %    │                       │ (Mio SFr) │ (Mio SFr) │
├────────────────────────────────────────┼────┼───────────┼───────────────────────┼───────────┼───────────┤
│ Claims in respect of money market p.   │    │    6,75   │                       │     500   │       34 │
├───────────────────────┬────────────────┼────┼───────────┼───────────────────────┼───────────┼───────────┤
│ Due from banks        │ on demand      │    │    7,50   │                       │     850   │       64 │
│ Due from banks        │ at term        │    │    6,75   │                       │    4600   │      310 │
├───────────────────────┼────────────────┼────┼───────────┼───────────────────────┼───────────┼───────────┤
│ Due from customers    │ sec.by mortgage│ CA │    7,50   │                       │    4044   │      303 │
│ Due from customers    │ sec.by mortgage│ FA │    6,40   │                       │     449   │       29 │
│ Due from customers    │ other security │ CA │    7,50   │                       │    2429   │      182 │
│ Due from customers    │ other security │ FA │    6,40   │                       │    3643   │      233 │
│ Due from customers    │ unsecured      │ CA │    7,50   │                       │    3016   │      226 │
│ Due from customers    │ unsecured      │ FA │    6,40   │                       │    4524   │      290 │
├───────────────────────┼────────────────┼────┼───────────┼───────────────────────┼───────────┼───────────┤
│ Mortgage claims       │ variable       │ FA │    6,00   │                       │    7007   │      420 │
│ Mortgage claims       │ fixed          │ FA │    6,00   │                       │    5297   │      318 │
├───────────────────────┼────────────────┼────┼───────────┼───────────────────────┼───────────┼───────────┤
│ Securities trad. port.│ shares         │    │    6,75   │                       │    1000   │       68 │
│ Securities trad. port.│ bonds          │    │    6,00   │                       │    1000   │       60 │
├───────────────────────┼────────────────┼────┼───────────┼───────────────────────┼───────────┼───────────┤
│ Due to banks          │ on demand      │    │    7,50   │                       │     600   │       45 │
│ Due to banks          │ at term        │    │    6,75   │                       │    4500   │      304 │
├───────────────────────┼────────────────┼────┼───────────┼───────────────────────┼───────────┼───────────┤
│ Due to customers      │ saving deposits│    │    6,00   │                       │   10896   │      654 │
│ Due to customers      │ Investm. dep. │     │    7,50   │                       │    3597   │      270 │
├───────────────────────┼────────────────┼────┼───────────┼───────────────────────┼───────────┼───────────┤
│ Due to customers other│ on demand      │    │    7,50   │                       │    3791   │      284 │
│ Due to customers other│ at term        │    │    6,75   │                       │    8077   │      545 │
├───────────────────────┴────────────────┼────┼───────────┼───────────────────────┼───────────┼───────────┤
│ Medium-term notes                      │    │    6,40   │                       │    5388   │      345 │
│ Long-term bonds                        │    │    6,00   │                       │    2100   │      126 │
├────────────────────────────────────────┴────┴───────────┴───────────────────────┴───────────┼───────────┤
│                                                              Structural Contribution Total │ Σ     -36 │
└─────────────────────────────────────────────────────────────────────────────────────────────┴───────────┘




    BANKING GAME                            Participants' Manual                                 45
2.8.1.   Notes to the reference rate system


         Interest rate contribution
         The interest rate contribution compares the bank’s own interest rate with the reference
         rate. The term ‘reference rate’ is always used to mean the prevailing rate on the
         interbank market (i.e. the cost of borrowing money on the interbank market and the rate of
         interest earned on deposited assets). The figure indicates the income contribution of the
         bank’s own interest rates in comparison with the reference rate. In the accounts, income
         contribution is expressed as a margin (%) and as a figure (SFr million).

         If, for instance, the bank’s lending rate is higher than the reference rate, then the bank
         makes a profit compared to the market. In other words, the bank makes more from a
         transaction than ‘prescribed’ by the reference rate. This ‘profit’ is referred to as a positive
         interest rate contribution.

         As far as customer deposits are concerned, if the bank’s deposit rate is lower than the
         reference rate, then the bank incurs less interest expenditure. This too constitutes a
         positive interest rate contribution, illustrating that customer deposits also have a role to
         play in terms of interest income.

         Among other things, the figure for the interest rate contribution helps the Executive Board to
         identify those areas which are earning the bank money and how much scope there is in
         terms of pricing policy (setting terms and conditions).



         Structural contribution
         The structural contribution is a means of examining the impact of the bank’s lending and
         deposit structure on income.

         When we talk about the lending and deposit structure, we mean the composition of the two
         sides of the balance sheet - as a result of the bank’s business strategy - with regard to long
         and short-term funds.

         The income contribution is the result of the interest rates applied to the various balance sheet
         categories. It is normally the case that short-term deposits attract lower rates of interest than
         longer-term ones. If, for instance, the bank refinances its long-term assets (which
         usually earn higher rates of interest) with short-term funds (which tend to earn less
         interest), then the structural contribution will be positive. As above, reference rates are
         used to calculate the structural contribution.

         It is important to remember that short-term financing involves certain risks. On the one hand,
         by breaking the golden rule of banking which states that short-term deposits should only be
         used for short-term lending, liquidity problems may arise. On the other hand, the bank
         assumes an element of interest rate risk since the yield curve may suddenly become
         inverted as a result of market developments.

         The figure for structural contribution helps the Executive Board to identify potential risks in
         the balance sheet structure and areas where appropriate risk management
         countermeasures need to be taken.




BANKING GAME                                Participants' Manual                                       46
   2.9.     Market and Competition Report

┌──────────────────────────────────────────────────────────────────────────────────────────────────────┐
│ BANKING GAME                                                             Copyright (c) 1999 by UNICON │
│                                                                          Bank 1              Period 0 │
│ EDUTRAIN AG - CH 8048 ZURICH                                             V 8.0         Date 8. 6.1999 │
├──────────────────────────────────────────────────────────────────────────────────────────────────────┤
│                                                                                                        │
│                 M A R K E T   A N D   C O M P E T I T I O N    R E P O R T      page 1                 │
│                                                                                                        │
├──────────────────────────────────────┬───────┬───────┬───────┬───────┬───────┬───────┬───────┬───────┤
│ BALANCE SHEET DATA (Mio SFr)         │ Bank 1│ Bank 2│ Bank 3│ Bank 4│ Bank 5│ Bank 6│ Bank 7│ Bank 8│
├──────────────────────────────────────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┤
│ Liquidity                            │   2619│   2619│   2619│    2619│   2619│    2619│   2619│   2619│
│ Due from banks                       │   5450│   5450│   5450│    5450│   5450│    5450│   5450│   5450│
│ Claims in resp. of money market pap. │    500│    500│    500│     500│     500│    500│    500│    500│
│ Due from customers                   │ 18105│ 18105│ 18105│ 18105│ 18105│ 18105│ 18105│ 18105│
│   secured by mortgage                │   4494│   4494│   4494│    4494│   4494│    4494│   4494│   4494│
│   other security                     │   6072│   6072│   6072│    6072│   6072│    6072│   6072│   6072│
│   unsecured                          │   7540│   7540│   7540│    7540│    7540│   7540│   7540│   7540│
│ Mortgage claims                      │ 12305│ 12305│ 12305│ 12305│ 12305│ 12305│ 12305│ 12305│
│   with variable interest rate        │   7007│   7007│   7007│    7007│   7007│    7007│   7007│   7007│
│   with fixed interest rate           │   5297│   5297│   5297│    5297│    5297│   5297│   5297│   5297│
│ Securities trading portfolio         │   2000│   2000│   2000│    2000│   2000│    2000│   2000│   2000│
│ Other assets                         │   1480│   1480│   1480│    1480│    1480│   1480│   1480│   1480│
│ Net loss                             │      0│      0│       0│      0│       0│      0│      0│      0│
├──────────────────────────────────────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┤
│ Due to banks                         │   5100│   5100│   5100│    5100│   5100│    5100│   5100│   5100│
│ Due to customers                     │ 14493│ 14493│ 14493│ 14493│ 14493│ 14493│ 14493│ 14493│
│   saving deposits                    │ 10896│ 10896│ 10896│ 10896│ 10896│ 10896│ 10896│ 10896│
│   investment deposits                │   3597│   3597│   3597│    3597│   3597│    3597│   3597│   3597│
│ Due to customers, other              │ 11869│ 11869│ 11869│ 11869│ 11869│ 11869│ 11869│ 11869│
│   on demand                          │   3791│   3791│   3791│    3791│   3791│    3791│   3791│   3791│
│   at term                            │   8077│   8077│   8077│    8077│   8077│    8077│   8077│   8077│
│ Medium-term notes                    │   5388│   5388│   5388│    5388│    5388│   5388│   5388│   5388│
│ Long-term bonds                      │   2100│   2100│   2100│    2100│    2100│   2100│   2100│   2100│
│ Write-downs and provisions           │    810│    810│    810│     810│     810│    810│    810│    810│
│ Capital resource                     │   2525│   2525│   2525│    2525│   2525│    2525│   2525│   2525│
│ Net profit                           │    175│    175│    175│     175│     175│    175│    175│    175│
├──────────────────────────────────────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┤
│ BALANCE SHEET TOTAL                  │ 42459│ 42459│ 42459│ 42459│ 42459│ 42459│ 42459│ 42459│
├──────────────────────────────────────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┤
│ PROFIT AND LOSS ACCOUNT (Mio SFr)    │       │       │        │       │        │       │       │       │
│ Income from interest business        │    755│    755│    755│     755│     755│    755│    755│    755│
│ Commission income                    │    606│    606│    606│     606│     606│    606│    606│    606│
│ Income from trading                  │      0│      0│       0│      0│       0│      0│      0│      0│
│ Staff costs                          │    522│    522│    522│     522│     522│    522│    522│    522│
│ Operating expenditure                │    214│    214│    214│     214│     214│    214│    214│    214│
│ Write-downs on fixed assets          │    200│    200│    200│     200│     200│    200│    200│    200│
│ Write-downs, provisions and losses   │    192│    192│    192│     192│     192│    192│    192│    192│
│ Extraordinary income / expenditure   │      0│      0│       0│      0│       0│      0│      0│      0│
│ Tax                                  │     58│     58│      58│     58│      58│     58│     58│     58│
├──────────────────────────────────────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┤
│ INTEREST RATE CONDITIONS (%)         │       │       │        │       │        │       │       │       │
│ Due from customers sec. by mortgage │    6,50│   6,50│   6,50│    6,50│   6,50│    6,50│   6,50│   6,50│
│                    other security    │   7,00│   7,00│   7,00│    7,00│   7,00│    7,00│   7,00│   7,00│
│                    unsecured         │   7,50│   7,50│   7,50│    7,50│   7,50│    7,50│   7,50│   7,50│
│ Mortgage claims variable interest r. │   6,50│   6,50│   6,50│    6,50│   6,50│    6,50│   6,50│   6,50│
│                 fixed interest rate │    6,75│   6,75│   6,75│    6,75│    6,75│   6,75│   6,75│   6,75│
│ Due to banks on demand               │   0,00│   0,00│   0,00│    0,00│   0,00│    0,00│   0,00│   0,00│
│              at term                 │   6,70│   6,70│   6,70│    6,70│   6,70│    6,70│   6,70│   6,70│
│ Due to customers saving deposits     │   5,00│   5,00│   5,00│    5,00│    5,00│   5,00│   5,00│   5,00│
│                  investment deposits │   2,00│   2,00│   2,00│    2,00│   2,00│    2,00│   2,00│   2,00│
│                  on demand           │   0,25│   0,25│   0,25│    0,25│    0,25│   0,25│   0,25│   0,25│
│                  at term             │   6,50│   6,50│   6,50│    6,50│   6,50│    6,50│   6,50│   6,50│
│ Medium-term notes                    │   6,00│   6,00│   6,00│    6,00│    6,00│   6,00│   6,00│   6,00│
└──────────────────────────────────────┴───────┴───────┴───────┴───────┴───────┴───────┴───────┴───────┘




   BANKING GAME                            Participants' Manual                                 47
┌──────────────────────────────────────────────────────────────────────────────────────────────────────┐
│ BANKING GAME                                                            Copyright (c) 1999 by UNICON │
│                                                                         Bank 1             Period 0 │
│ EDUTRAIN AG - CH 8048 ZURICH                                            V 8.0        Date 8. 6.1999 │
├──────────────────────────────────────────────────────────────────────────────────────────────────────┤
│                                                                                                      │
│                  M A R K E T   A N D   C O M P E T I T I O N   R E P O R T       page 2              │
│                                                                                                      │
├──────────────────────────────────────┬───────┬───────┬───────┬───────┬───────┬───────┬───────┬───────┤
│                                      │ Bank 1│ Bank 2│ Bank 3│ Bank 4│ Bank 5│ Bank 6│ Bank 7│ Bank 8│
│ MARKET SHARES (%)                    │       │       │       │       │       │       │       │       │
├──────────────────────────────────────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┤
│ Due from customers                   │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │
│ Mortgage claims                      │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │
├──────────────────────────────────────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┤
│ Due to banks                         │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │
│ Due to customers                     │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │
│ Due to customers, other              │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │
│ Medium-term notes                    │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │ 12,50 │
├──────────────────────────────────────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┤
│ Personnel (number)                   │ 6795 │ 6795 │ 6795 │ 6795 │ 6795 │ 6795 │ 6795 │ 6795 │
│ Additional personnel costs (%)       │ 12,0 │ 12,0 │ 12,0 │ 12,0 │ 12,0 │ 12,0 │ 12,0 │ 12,0 │
├──────────────────────────────────────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┤
│ Level of automation (Index)          │ 75,0 │ 75,0 │ 75,0 │ 75,0 │ 75,0 │ 75,0 │ 75,0 │ 75,0 │
├──────────────────────────────────────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┤
│ Asset administration performance ind.│   4,6 │   4,6 │   4,6 │   4,6 │   4,6 │   4,6 │   4,6 │   4,6 │
│ Volume Asset administration          │ 11200 │ 11200 │ 11200 │ 11200 │ 11200 │ 11200 │ 11200 │ 11200 │
│ Turnover custodianship business      │ 56175 │ 56175 │ 56175 │ 56175 │ 56175 │ 56175 │ 56175 │ 56175 │
│ Commission rate (%)                  │ 1,00 │ 1,00 │ 1,00 │ 1,00 │ 1,00 │ 1,00 │ 1,00 │ 1,00 │
├──────────────────────────────────────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┤
│ Share price                          │   500 │   500 │   500 │   500 │   500 │   500 │   500 │   500 │
└──────────────────────────────────────┴───────┴───────┴───────┴───────┴───────┴───────┴───────┴───────┘

┌──────────────────────────────────────────────────────────────────────────────────────────────────────┐
│                              GENERAL DATA OF THE BANKING INDUSTRY                                    │
├─────────────────────────────────────────────────┬────────────────────────────────────────────────────┤
│ Euro:                             1,65          │ PERSONNEL DATA                                     │
│                                                 │                                                    │
│ INTEREST RATES                                  │ Wages and salaries:                                │
│   due from banks on demand        0,00          │   Lending business               75000             │
│   due from banks at term          6,75          │   Custodianship business         65000             │
│   Money market papers SFr         6,75          │   Asset administration           85000             │
│   Money market papers Euro        7,25          │   Deposit business               70000             │
│   Long-term bonds                 6,00          │   Money transfer                 55000             │
│   Bridging credit                11,00          │   Others                         68000             │
├─────────────────────────────────────────────────┼────────────────────────────────────────────────────┤
│ SHARES                                          │                                                    │
│   Dividend      domestic           5,0          │                                                    │
│                 foreign            7,0          │                                                    │
│   Share prices domestic          100,0          │                                                    │
│                 foreign          200,0          │                                                    │
│ BONDS (Interest rates)                          │                                                    │
│                 domestic           6,0          │                                                    │
│                 foreign            6,5          │                                                    │
│ HEDGING COSTS (%)                               │                                                    │
│     Shares      domestic           3,0          │                                                    │
│                 foreign            3,0          │                                                    │
│     Bonds       domestic           2,0          │                                                    │
│                 foreign            2,0          │                                                    │
│     Euro                           2,0          │                                                    │
└─────────────────────────────────────────────────┴────────────────────────────────────────────────────┘




  BANKING GAME                            Participants' Manual                                48
2.9.1.   Comments on the Market and Competition Report


         This report gives you information about the data of your competitors in terms of



                         Balance sheet
                         Profit and loss account
                         Interest conditions
                         Market shares
                         Number of staff
                         Deposit Performance-Index (DPI)
                         Volume of asset administration
                         Turnover of custody business
                         General data of the banking industry



         The market and competition report must be ordered on Decision-Taking Form I. The cost of
         this report is 3 million SFr.




BANKING GAME                               Participants' Manual                               49
2.10. Capital Adequacy Report

     ┌──────────────────────────────────────────────────────────────────────────────┐
     │ BANKING GAME                                     Copyright (c) 1999 by UNICON │
     │                                                  Bank 1             Period 0 │
     │ EDUTRAIN AG - CH 8048 ZURICH                     V 8.0         Date 8. 6.1999 │
     ├──────────────────────────────────────────────────────────────────────────────┤
     │                                                                               │
     │                C A P I T A L   A D E Q U A C Y    R E P O R T                 │
     │                                                                               │
     ├─────────────────────────────────────────┬───────────┬───────────┬────────────┤
     │                                         │            │ Risk-      │ Risk-     │
     │ ASSETS (Mio SFr)                        │Book value │ weighting │ weighted │
     │                                         │            │ factor % │ position │
     ├─────────────────────────────────────────┼───────────┼───────────┼────────────┤
     │                                         │            │            │           │
     │ Liquidity                               │     2619 │       0,0    │        0 │
     │                                         │            │            │           │
     │ Claims in respect of money market paper │       500 │     25,0    │      125 │
     │                                         │            │            │           │
     │ Due from banks                          │            │            │           │
     │     on demand                           │       850 │     25,0    │      213 │
     │     at term                             │      4600 │     50,0    │     2300 │
     │                                         │            │            │           │
     │ Due from customers                      │            │            │           │
     │     secured by mortgage                 │      4494 │     50,0    │     2247 │
     │     other security                      │     6072 │      75,0    │     4554 │
     │     unsecured                           │     7540 │     100,0    │     7540 │
     │                                         │            │            │           │
     │ Mortgage claims                         │            │            │           │
     │     variable interest rate              │     7007 │      50,0    │     3504 │
     │     fixed interest rate                 │     5297 │      50,0    │     2649 │
     │                                         │            │            │           │
     │ Securities trading portfolio            │            │            │           │
     │     shares    domestic                  │       500 │    125,0    │      625 │
     │               foreign                   │       500 │    125,0    │      625 │
     │     bondss    domestic                  │       500 │    100,0    │      500 │
     │               foreign                   │       500 │    100,0    │      500 │
     │                                         │            │            │           │
     │ Holdings                                │         0 │    100,0    │        0 │
     │                                         │            │            │           │
     │ Physical assets                         │       570 │    250,0    │     1425 │
     │                                         │            │            │           │
     │ Ohter physical assets                   │       680 │    625,0    │     4250 │
     │                                         │            │            │           │
     │ Ohter assets                            │       230 │     50,0    │      115 │
     │                                         │            │            │           │
     ├─────────────────────────────────────────┼───────────┼───────────┼────────────┤
     │ TOTAL                                   │    42459 │              │    31171 │
     │                                         ├───────────┤             │           │
     │ CAPITAL RESOURCES REQUIRED              │            │            │     2494 │
     │ ( 8,0% of the risk-weighted position)   │            │            │           │
     ├─────────────────────────────────────────┼───────────┼───────────┼────────────┤
     │                                         │            │            │           │
     │ ACTUAL CAPITAL RESOURCES                │            │            │           │
     │                                         │            │            │           │
     │ SHAREHOLDERS' EQUITY                    │            │            │           │
     │ Share capital                           │            │            │      800 │
     │ Declared reserves                       │            │            │     1725 │
     │                                         │            │            │           │
     │ ADDITIONAL CAPITAL                      │            │            │           │
     │ Subordinated bonds   (max. 50,0%)       │            │            │        0 │
     │                                         │            │            │           │
     ├─────────────────────────────────────────┼───────────┼───────────┼────────────┤
     │ SURPLUS / DEFICIT                       │            │            │       31 │
     └─────────────────────────────────────────┴───────────┴───────────┴────────────┘




BANKING GAME                        Participants' Manual                                 50
2.10.1. Comments on the Capital Adequacy Report


      Capital Resources are the basis of business activities in any enterprise. Capital resources
      are defined as:

       Share Capital
       Legal Reserves
       Other Reserves

      The capital resources of a bank are augmented by increasing the reserves (non-
      disbursement of profits) or by an increase in capital. In order to protect the creditors, banks
      have to make sure that there is an appropriate ratio between their capital resources and the
      total of their liabilities. The capital resources thus required are computed on the basis of the
      risk-weihted value of the assets, which have to be covered by 8 % of capital resources.

      Moreover the bank can add subordinated bonds to the capital resources (not more than 50 %
      of the shareholders equity = share capital + reserves).

      If the capital resources required are not available, the bank has to carry out an
      increase in capital or issue subordinated bonds. Otherwise the seminar leader may
      exert an influence on your decision according to the spirit of the Federal Banking
      Commission.




BANKING GAME                            Participants' Manual                                       51
2.11. Liquidity statement

┌────────────────────────────────────────────────────────────────────────────────────┐
│ BANKING GAME                                          Copyright (c) 1999 by UNICON │
│                                                       Bank 1             Period 0 │
│ EDUTRAIN AG - CH 8048 ZURICH                          V 8.0        Date 8. 6.1999 │
├────────────────────────────────────────────────────────────────────────────────────┤
│                                                                                    │
│                       L I Q U I D I T Y   S T A T E M E N T                        │
│                                                                                    │
├──────────────────────────────────────────────────────────────────────┬─────────────┤
│ LIQUIDITY STATEMENT I: CASH LIQUIDITY                                │   Mio SFr   │
├──────────────────────────────────────────────────────────────────────┼─────────────┤
│      LIABILITIES                                                     │             │
│      Due to banks                         < 3 months (share)         │      2850   │
│      Due to customers, other: on demand                              │      3791   │
│      Due to customers, other: at term     < 3 months (share)         │      4039   │
│      20,0% of due to customers, savings and investment deposits      │      2899   │
│                                                                      ├─────────────┤
│      Total liabilities (1)                                           │     13579   │
│                                                                      │             │
│      Required cash liquidity ( 2,5% of total liabilities 1)          │       339   │
│                                                                      │             │
│      LIQUIDITY                                                       │      2619   │
│                                                                      │             │
│      CASH LIQUDITY (Surplus+ / Deficit -)                            │      2280   │
├──────────────────────────────────────────────────────────────────────┼─────────────┤
│ LIQUDITY STATEMENT II: OVERALL LIQUIDITY                             │   Mio SFr   │
├──────────────────────────────────────────────────────────────────────┼─────────────┤
│      Easily marketable assets                                        │             │
│      - Due from banks                  < 1 month (share)             │      2230   │
│      minus                                                           │             │
│      Short-term liabilities                                          │             │
│      - Due to banks                    < 1 month (share)             │      1950   │
│      - Due to customers at term        < 1 month (share)             │      2423   │
│      - Medium-tern notes and bonds     < 1 month (share)             │       121   │
│      = Surplus "easily marketable assets" or                         │         0   │
│      = Surplus "short-term liabilities"                              │      2264   │
│                                                                      │             │
│ LIQUIDITY STATEMENT                                                  │   Mio SFr   │
│                                                                      │             │
│      LIABILITIES                                                     │             │
│      - Surplus "short-term liabilities"                              │      2264   │
│      - 50,0% of due to customers on demand                           │      1896   │
│      - 15,0% of due to customers, savings and investment deposits    │      2174   │
│      T o t a l (2)    short-term liabilities                         │      6334   │
│                                                                      │             │
│      ASSETS                                                          │             │
│      - Surplus "easily marketable assets"                            │         0   │
│      - Claims in respect of money market paper                       │       500   │
│      - Securities (share)                                            │       375   │
│      - Due from customers: other security (share)                    │       607   │
│      T o t a l (3)    easily marketable assets                       │      1482   │
│                                                                      │             │
│      plus liquidity   (4)                                            │      2619   │
│      = Total liquidity and easily marketable assets (3 + 4)          │      4101   │
│                                                                      │             │
│      Liquidity and easily marketable assets (3 + 4)                  │      4101   │
│      minus                                                           │             │
│      Required liquidity and easily marketable assets                 │             │
│      (33,3% von total 2 short term liabilities)                      │      2109   │
│                                                                      │             │
│      = Surplus + / Deficit -                                         │      1992   │
│                                                                      │             │
└──────────────────────────────────────────────────────────────────────┴─────────────┘




BANKING GAME                           Participants' Manual                              52
2.11.1. Comments on the Liquidity Statement


       Liquidity is the fundamental basis for the long-term solvency of a bank. The liquidity
       regulations of the Banking Law require so-called cash liquidity and overall liquidity, which also
       comprises, apart from the disposable means (Liqudity), some easily marke-table assets.

       As far as overall liquidity is concerned, the disposable means and the easily
       marketable assets have to cover the short-term liabilities up to a certain percentage.
       The amounts are graded according to the share of short-term liabilities in relation to the total
       of liabilities. The higher the share of short-term liabilities, the more liquidity is required. The
       ratio "easily marketable assets" / "short-term liabilities" for the Banking game can be
       seen from the Liquidity Statement.

       If there is a shortage of cover, the model will automatically claim a bridging credit, the amount
       of which will correspond to that of the negative liquidity. A shortage of cover will also have a
       negative effect on the share price of your bank.



       The balance-sheet item "Bridging Credit" consists of the two values

       1. Bridging Credit I (Medium-Flow Computation)

       2. Bridging Credit II according to the negative liquidity in the Liquidity Statement.



       If your Liquidity Statement shows a shortage of cover, you will have to make sure in
       the following period that you change this shortage into a surplus cover. Otherwise the
       seminar leader may exert an influence on your decision according to the spirit of the
       Federal Banking Commission.




BANKING GAME                              Participants' Manual                                         53
2.12. Survey of Share and Bond Portfolio

┌───────────────────────────────────────────────────────────────────────────────────────────────┐
│ BANKING GAME                                                       Copyright (c) 1999 by UNICON │
│                                                                    Bank 1               Period 0 │
│ EDUTRAIN AG - CH 8048 ZURICH                                       V 8.0          Date 8. 6.1999 │
├───────────────────────────────────────────────────────────────────────────────────────────────┤
│                                                                                                   │
│                                 SHARES - HOLDINGS AND VALUES                                      │
│                                                                                                   │
├───────────────────────────────┬───────────┬────────┬─────────┬────────────┬─────────┬─────────┤
│   DOMESTIC SHARES             │ Thousand │         │          │    Value      │ Loss    │ Profit │
│   OWN HOLDINGS                │ shares    │        │ Index │       Mio. SFr │ Mio.SFr│ Mio.SFr │
├───────────────────────────────┼───────────┼────────┼─────────┼────────────┼─────────┼─────────┤
│   Holdings end of prev. period│        0 │         │     0,0 │           0    │      0 │       0 │
│   New valuation               │         0 │         │ 100,0 │            0    │      0 │       0 │
│ + Buying / - Selling          │     5000 │         │ 100,0 │           500    │      0 │       0 │
│   Hedging costs rate          │           │        │          │               │      0 │          │
│ = Holdings end of period      │     5000 │         │ 100,0 │           500    │      0 │       0 │
├───────────────────────────────┼───────────┼────────┼─────────┼────────────┼─────────┼─────────┤
│   FOREIGN SHARES              │ Thousand │ Euro │             │    Value      │ Loss    │ Profit │
│   OWN HOLDINGS                │ shares    │ Rate │ Index │         Mio. SFr │ Mio SFr│ Mio. SFr│
├───────────────────────────────┼───────────┼────────┼─────────┼────────────┼─────────┼─────────┤
│   Holdings end of prev. period│        0 │ 0,00 │        0,0 │           0    │      0 │       0 │
│   New valuation               │        0 │ 1,65 │ 200,0 │                0    │      0 │       0 │
│   of foreign exchange         │           │        │          │               │      0 │       0 │
│ + Buying / - Selling          │     1515 │ 1,65 │ 200,0 │              500    │      0 │       0 │
│   Hedging costs rate          │           │        │          │               │      0 │          │
│   Hedging costs foreign exch. │           │         │         │               │      0 │          │
│ = Holdings end of period      │     1515 │ 1,65 │ 200,0 │              500    │      0 │       0 │
├───────────────────────────────┼───────────┼────────┼─────────┼────────────┼─────────┼─────────┤
│   DOMESTIC SHARES             │ Thousand │         │          │    Value      │ Loss    │ Profit │
│   ASSET ADMINISTRATION        │ shares    │        │ Index │       Mio. SFr │ Mio.SFr│ Mio. SFr│
├───────────────────────────────┼───────────┼────────┼─────────┼────────────┼─────────┼─────────┤
│   Holdings end of prev. period│        0 │         │     0,0 │           0    │      0 │       0 │
│   New valuation               │        0 │         │ 100,0 │             0    │      0 │       0 │
│   Hedging costs foreign exch. │           │        │          │               │      0 │          │
│   Holdings end of period      │    22400 │         │ 100,0 │         2240     │      0 │       0 │
├───────────────────────────────┼───────────┼────────┼─────────┼────────────┼─────────┼─────────┤
│   FOREIGN SHARES              │ Thousand │ Euro │             │    Value      │ Loss    │ Profit │
│   ASSET ADMINISTRATION        │ shares    │ Rate │ Index │         Mio. SFr │ Mio.SFr│ Mio. SFr│
├───────────────────────────────┼───────────┼────────┼─────────┼────────────┼─────────┼─────────┤
│   Holdings end of prev. period│        0 │ 0,00 │        0,0 │           0    │      0 │       0 │
│   New valuation               │        0 │ 1,65 │ 200,0 │                0    │      0 │       0 │
│   Hedging costs rate          │           │        │          │               │      0 │          │
│   Hedging costs foreign exch. │           │        │          │               │      0 │          │
│   Holdings end of period      │     6788 │ 1,65 │ 200,0 │             2240    │      0 │       0 │
├───────────────────────────────┼───────────┴────────┴─────────┴┬───────────┴─────────┴─────────┤
│   OVERALL VIEW (Mio. Sfr)     │          Own Holdings          │            Asset Administration │
│   SUCCESS RATINGS -           │Hedging/                         │Heding/                          │
│   INCOME FROM SECURITIES      │Losses │Profit │ Yield │ Total │Losses │Profit │ Yield │ Total │
├───────────────────────────────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┤
│   Domestic money market       │       │       │    17 │     17 │         │        │    76 │    76 │
│   Foreign money market        │     0 │     0 │    18 │     18 │       0 │      0 │    81 │    81 │
│   Domestic shares             │     0 │     0 │     25 │    25 │       0 │      0 │   112 │   112 │
│   Foreign shares              │     0 │     0 │    18 │     18 │       0 │      0 │    78 │    78 │
│   Domestic bonds              │     0 │     0 │    30 │     30 │       0 │      0 │   134 │   134 │
│   Foreign bonds               │     0 │     0 │    33 │     33 │       0 │      0 │   146 │   146 │
├───────────────────────────────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┼───────┤
│   Total                       │     0 │     0 │   140 │    140 │       0 │      0 │   627 │   627 │
├───────────────────────────────┼───────┴───────┴───────┼───────┴───┬───┴───────┼───────┴───────┤
│                               │     DECISIONS (%)      │ Deviation │     Fees     │               │
│   ASSET ADMINISTRATION        │Last period│ Period     │ (absolut) │ Mio. SFr │        Volume     │
├───────────────────────────────┼───────────┼───────────┼───────────┼───────────┼───────────────┤
│   Domestic money market       │           │      10    │            │     0,00    │      1120     │
│   Foreign money market        │           │      10    │            │     0,00    │      1120     │
│   Domestic shares             │           │      20    │            │     0,00    │      2240     │
│   Foreign shares              │           │      20    │            │      0,00   │      2240     │
│   Domestic bonds              │           │      20    │            │     0,00    │      2240     │
│   Foreign bonds               │           │      20    │            │     0,00    │      2240     │
├───────────────────────────────┼───────────┼───────────┼───────────┼───────────┼───────────────┤
│   Total                       │           │     100    │            │     0,00    │     11200     │
├───────────────────────────────┼───────────┴───────────┼───────────┴───────────┴───────────────┤
│   Performance-Index:          │ Period    :     4,6    │                Average :         4,6     │
└───────────────────────────────┴───────────────────────┴───────────────────────────────────────┘




BANKING GAME                             Participants' Manual                                  54
┌──────────────────────────────────────────────────────────────────────────────────────────────────────────┐
│ BANKING GAME                                                                 Copyright (c) 1999 by UNICON │
│                                                                               Bank 1             Period 0 │
│ EDUTRAIN AG - CH 8048 ZURICH                                                 V 8.0         Date 8. 6.1999 │
├──────────────────────────────────────────────────────────────────────────────────────────────────────────┤
│                                                                                                            │
│                            BONDS - HOLDINGS AND VALUES   (Nominal value 1000 SFr)                          │
│                                                                                                            │
├──────────────────────────┬────────────┬───────────┬───────┬───────┬────────┬─────────┬───────────────────┤
│ DOMESTIC BONDS           │            │ Holdings │        │Inter.-│         │Change    │   Success Rate    │
│ OWN HOLDINGS             │   Value    │ nominal │         │Rate   │ Price │last per.│ Loss         Profit │
│                          │   Mio. SFr │ Mio. SFr │        │   %   │ in % │in %         │Mio. SFr │ Mio. SFr│
├──────────────────────────┼────────────┼───────────┼───────┼───────┼────────┼─────────┼─────────┼─────────┤
│ Bonds from:     Period 0 │       500 │       500 │        │ 6,00 │ 100,0 │        0,00 │      0 │       0 │
│ Hedging costs rate       │            │           │       │       │         │          │      0 │          │
├──────────────────────────┼────────────┼───────────┼───────┼───────┼────────┼─────────┼─────────┼─────────┤
│               Total      │       500 │       500 │        │ 6,00 │         │           │      0 │       0 │
├──────────────────────────┴────────────┴───────────┴───────┴───────┴────────┴─────────┴─────────┴─────────┤
├──────────────────────────┬────────────┬───────────┬───────┬───────┬────────┬─────────┬───────────────────┤
│ FOREIGN BONDS            │            │ Holdings │        │Inter.-│         │Change    │   Success Rate    │
│ OWN HOLDINGS             │   Value    │ nominal │ Euro │rate      │ Price │last per.│ Loss         Profit │
│                          │   Mio. SFr │ Mio. SFr │ rate │     %   │ in % │in %         │Mio. SFr │ Mio. SFr│
├──────────────────────────┼────────────┼───────────┼───────┼───────┼────────┼─────────┼─────────┼─────────┤
│ Bonds from:     Period 0 │       500 │       500 │ 1,65 │ 6,50 │ 100,0 │          0,00 │      0 │       0 │
│ of foreign exchange      │            │           │       │       │       │            │      0 │       0 │
│ Hedging costs rate       │            │           │       │       │        │           │      0 │          │
│ Hedging costs for. exch.│             │           │       │       │        │           │      0 │          │
├──────────────────────────┼────────────┼───────────┼───────┼───────┼────────┼─────────┼─────────┼─────────┤
│               Total      │       500 │       500 │        │ 6,50 │          │          │      0 │       0 │
├──────────────────────────┴────────────┴───────────┴───────┴───────┴────────┴─────────┴─────────┴─────────┤
├──────────────────────────┬────────────┬───────────┬───────┬───────┬────────┬─────────┬───────────────────┤
│ DOMESTIC BONDS           │            │ Holdings │        │Inter.-│         │Change    │   Success Rate    │
│ ASSET ADMINISTRATION     │   Value    │ nominal │         │Rate   │ Price │last per.│ Loss         Profit │
│                          │   Mio. SFr │ Mio. SFr │        │   %   │ in % │in %         │Mio. SFr │ Mio. SFr│
├──────────────────────────┼────────────┼───────────┼───────┼───────┼────────┼─────────┼─────────┼─────────┤
│ Holdings end of prev. p.│          0 │         0 │        │ 0,00 │    0,0 │       0,00 │      0 │       0 │
│ New valuation            │         0 │         0 │        │ 0,00 │    0,0 │       0,00 │      0 │       0 │
│ Hedging costs rate       │            │           │       │       │        │           │      0 │          │
├──────────────────────────┼────────────┼───────────┼───────┼───────┼────────┼─────────┼─────────┼─────────┤
│ Holdings end of period │        2240 │      2240 │        │ 6,00 │ 100,0 │             │         │         │
├──────────────────────────┴────────────┴───────────┴───────┴───────┴────────┴─────────┴─────────┴─────────┤
├──────────────────────────┬────────────┬───────────┬───────┬───────┬────────┬─────────┬───────────────────┤
│ FOREIGN BONDS            │            │ Holdings │        │Inter.-│         │Change    │   Success Rate    │
│ ASSET ADMINISTRATION     │   Value    │ nominal │ Euro │rate      │ Price │last per.│ Loss         Profit │
│                          │   Mio. SFr │ Mio. SFr │ rate │     %   │ in % │in %         │Mio. SFr │ Mio. SFr│
├──────────────────────────┼────────────┼───────────┼───────┼───────┼────────┼─────────┼─────────┼─────────┤
│ Holdings end of prev. p.│          0 │         0 │ 0,00 │ 0,00 │      0,0 │       0,00 │      0 │       0 │
│ New valuation            │         0 │         0 │ 0,00 │ 0,00 │      0,0 │       0,00 │      0 │       0 │
│ Hedging costs rate       │            │           │       │       │        │           │      0 │          │
│ Hedging costs for. exch.│             │           │       │       │         │          │      0 │          │
├──────────────────────────┼────────────┼───────────┼───────┼───────┼────────┼─────────┼─────────┼─────────┤
│ Holdings end of period │        2240 │      2240 │ 1,65 │ 6,50 │ 100,0 │               │         │         │
└──────────────────────────┴────────────┴───────────┴───────┴───────┴────────┴─────────┴─────────┴─────────┘

┌──────────────────────────────────────────────────────────────────────────────────────────────────────────┐
│                                                                                                          │
│                                             HOLDINGS - VALUES                                            │
│                                                                                                          │
├──────────────────────────────────┬────────┬────────┬────────┬────────────────────┬───────────────┬───────┤
│                                  │ Value │ No. of │ Buys/ │          RATES       │   Valuation   │ Divid.│
│                                  │        │ shares │ Sells │Prev. │Actual│Aver. │since │actual │         │
│                                  │        │        │        │period│period│price │buy    │period │       │
│                                  │ MioSFr │ in 1000│ MioSFr │ SFr │ SFr │ SFr │ MSFr │ MSFr │ MSFr │
├──────────────────────────────────┼────────┼────────┼────────┼──────┼──────┼──────┼───────┼───────┼───────┤
│ Holdings Typ A                   │        │        │        │      │      │      │       │       │       │
│ Holdings Typ B                   │        │        │        │      │      │      │       │       │       │
│ Holdings Typ C                   │        │        │        │      │      │      │       │       │       │
│ Holdings Typ D                   │        │        │        │      │      │      │       │       │       │
│ Holdings Typ E                   │        │        │        │      │      │      │       │       │       │
│ Holdings Typ F                   │        │        │        │      │      │      │       │       │       │
├──────────────────────────────────┼────────┼────────┼────────┼──────┼──────┼──────┼───────┼───────┼───────┤
│ Total Holdings                   │      0 │        │      0 │      │      │      │      0│      0│     0 │
└──────────────────────────────────┴────────┴────────┴────────┴──────┴──────┴──────┴───────┴───────┴───────┘




    BANKING GAME                             Participants' Manual                                 55
2.12.1. Comments on the Survey of Share and Bond Portfolio


       The upper part of the first page gives you an overview of the share holdings of your bank
       (Nostro) and the deposits that your bank is authorized to manage. The second page gives
       you an overview of the bond holdings.

       The lower part gives you an overall view of the valuation success ratings and the income
       from your own securities as well as from the management accounts. The individual columns
       denote the following:

            Hedging / Losses           =    Hedging costs / Exchange and currency losses
            Profits                    =    Exchange and currency profits
            Yield                      =    Interest and dividend income
            Total                      =    Total sum of the above items

       At the bottom of page 1 you will also see your decision made on management accounts as
       well as the changes in relation to the previous period. Shifting deposits causes fees which
       are added as commission earnings to the profit and loss account, but this may also have a
       negative effect on the performance of the customer deposits. These costs can be seen in the
       bottom table of page 1.

       On the bottom line you will find the performance index (PI) for the current period as well as
       the cumulative index (average) of all the previous periods. The volume of the management
       accounts mainly depends on their performance in the previous periods and also on your
       decisions in Personnel and Marketing. The PI is computed as follows:




                     Computation of Performance-Index (PI)
                           Interest securities
                     +     Interest bonds
                     +     Dividends shares
                     -/+   Exchange losses / profits bonds
                     -/+   Exchange losses / profits shares
                     -/+   Currency losses / profits ECU
                     -     Hedging costs
                     -     Service fees (Brokerage)
                     =     Total Earnings Asset Administration


                     PI = Total Earnings Asset Administration x 100
                                Volume Asset Administration




BANKING GAME                            Participants' Manual                                     56

								
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