Zusammenfassung der Ressource
B: Financial
System
- Global
- The global financial system is basically a broader regional
system that encompasses all financial institutions,
borrowers and lenders within the global economy.
- include the International Monetary Fund,
central banks, World Bank and major banks
that practice overseas lending.
- Regional
- Financial
Markets
- Stock Exchanges /
Capital Markets
- Primary
- Secondary
- Money
Markets
- Primary
- Secondary
- Provide shortterm (<
1 year) debt financing
and investment.
- Commodities
Market
- Which facilitate the
trading of commodities
(e.g. oil, metals and
agricultural produce).
- Derivatives
markets
- which provide instruments
for the management of
financial risk, such as options
and futures contracts (see
later for an explanation of
derivatives).
- Foreign
exchange
markets
- Insurance
markets
- Financial
Institutions
- Commercial
Banks
- Insurance
Companies
- Pension
Funds
- Building
Societies
- Financial
Securities
- Mortgages
- Equity
Shares
- Bonds
- Preference
Shares
- On a regional scale, the
financial system is the system
that enables lenders and
borrowers to exchange funds.
- Firm Specific Level
- The firm's financial system is
the set of implemented
procedures that track the
financial activities of the
company.
- FUNCTIONS
OF FINANCIAL
SYSTEM
- Creates liquidity and money –
e.g. banks create money
through increasing their
lending.
- Provides a mechanism for
payments – e.g. direct
debits, cheque clearing
system.
- Provides financial
services such as
insurance and
pensions.
- Offers facilities to
manage investment
portfolios – e.g. to
hedge risk.
- Channels funds from
lenders to borrowers.