Financial Intermediaries

MFS – JUL 2020 – L2 – Q6 – Financial Intermediation and Transformation Functions

Explain financial intermediation as a business and how transformation functions bridge gaps between lenders and borrowers.

Question

Financial Intermediaries can bridge the gap between borrowers and lenders and reconcile their often incompatible needs and objectives. Banks bridge this gap by performing the transformation functions: Size transformation, Maturity transformation and Risk transformation.

a. Explain financial intermediation as a business activity. (5marks)

b. Explain how Size transformation, Maturity transformation, and Risk transformation bridge the gap between lenders and borrowers (15marks)

[Total Marks: 20]

Answer

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Tags: borrowers, Financial Intermediaries, lenders, Maturity Transformation, risk transformation, size transformation
Level: Level 2

Topic: Financial institutions
Series: JULY 2020

EIB – APRIL 2023 – LEVEL I – Q6 – Financial Intermediaries and Banking Systems

This question covers naming financial intermediaries, defining bonds, conditions for effective central bank functioning, functions of commercial banks, reasons for adopting universal banking, and the extent of money supply expansion in banking systems.

Question

a) Name two financial intermediaries. b) Define the term bond. c) State three conditions under which the central bank can function effectively. d) Mention the functions of the commercial banks. e) What has forced the banks to adopt universal banking? f) A banking system can expand money supply by an amount equal to what?

Answer

Find Related Questions by Tags, levels, etc.

Tags: bond definition, central bank functions, commercial banks, Financial Intermediaries, money supply expansion, universal banking
Level: Level 1

Series: APR 2023

BMF – Nov 2020 – L1 – SA – Q15 – Basics of Business Finance and Financial Markets

Identify why banks are considered important financial intermediaries.

Question

Banks are important financial intermediaries because they:
A. Create new debt
B. Are the only source of debt finance
C. Are the only source of long-term finance
D. Operate between investors and borrowers
E. Take deposits from all their customers

Answer

Find Related Questions by Tags, levels, etc.

Tags: Banking, Financial Intermediaries, Investment
Level: Level 1

Topic: Basics of Business Finance and Financial Markets
Series: NOV 2020

MFS – JUL 2020 – L2 – Q6 – Financial Intermediation and Transformation Functions

Explain financial intermediation as a business and how transformation functions bridge gaps between lenders and borrowers.

Question

a. Explain financial intermediation as a business activity. (5marks)

b. Explain how Size transformation, Maturity transformation, and Risk transformation bridge the gap between lenders and borrowers (15marks)

[Total Marks: 20]

Answer

Find Related Questions by Tags, levels, etc.

Tags: borrowers, Financial Intermediaries, lenders, Maturity Transformation, risk transformation, size transformation
Level: Level 2

Topic: Financial institutions
Series: JULY 2020

EIB – APRIL 2023 – LEVEL I – Q6 – Financial Intermediaries and Banking Systems

This question covers naming financial intermediaries, defining bonds, conditions for effective central bank functioning, functions of commercial banks, reasons for adopting universal banking, and the extent of money supply expansion in banking systems.

Question

Answer

Find Related Questions by Tags, levels, etc.

Tags: bond definition, central bank functions, commercial banks, Financial Intermediaries, money supply expansion, universal banking
Level: Level 1

Series: APR 2023

BMF – Nov 2020 – L1 – SA – Q15 – Basics of Business Finance and Financial Markets

Identify why banks are considered important financial intermediaries.

Question

Answer

Find Related Questions by Tags, levels, etc.

Tags: Banking, Financial Intermediaries, Investment
Level: Level 1

Topic: Basics of Business Finance and Financial Markets
Series: NOV 2020

Question Tag: Financial Intermediaries

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MFS – JUL 2020 – L2 – Q6 – Financial Intermediation and Transformation Functions

Explain financial intermediation as a business and how transformation functions bridge gaps between lenders and borrowers.

EIB – APRIL 2023 – LEVEL I – Q6 – Financial Intermediaries and Banking Systems

This question covers naming financial intermediaries, defining bonds, conditions for effective central bank functioning, functions of commercial banks, reasons for adopting universal banking, and the extent of money supply expansion in banking systems.

BMF – Nov 2020 – L1 – SA – Q15 – Basics of Business Finance and Financial Markets

Identify why banks are considered important financial intermediaries.

MFS – JUL 2020 – L2 – Q6 – Financial Intermediation and Transformation Functions

Explain financial intermediation as a business and how transformation functions bridge gaps between lenders and borrowers.

EIB – APRIL 2023 – LEVEL I – Q6 – Financial Intermediaries and Banking Systems

This question covers naming financial intermediaries, defining bonds, conditions for effective central bank functioning, functions of commercial banks, reasons for adopting universal banking, and the extent of money supply expansion in banking systems.

BMF – Nov 2020 – L1 – SA – Q15 – Basics of Business Finance and Financial Markets

Identify why banks are considered important financial intermediaries.

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MFS – JUL 2020 – L2 – Q6 – Financial Intermediation and Transformation Functions

Explain financial intermediation as a business and how transformation functions bridge gaps between lenders and borrowers.

You're reporting an error for "MFS – JUL 2020 – L2 – Q6 – Financial Intermediation and Transformation Functions"

EIB – APRIL 2023 – LEVEL I – Q6 – Financial Intermediaries and Banking Systems

This question covers naming financial intermediaries, defining bonds, conditions for effective central bank functioning, functions of commercial banks, reasons for adopting universal banking, and the extent of money supply expansion in banking systems.

You're reporting an error for "EIB – APRIL 2023 – LEVEL I – Q6 – Financial Intermediaries and Banking Systems"

BMF – Nov 2020 – L1 – SA – Q15 – Basics of Business Finance and Financial Markets

Identify why banks are considered important financial intermediaries.

You're reporting an error for "BMF – Nov 2020 – L1 – SA – Q15 – Basics of Business Finance and Financial Markets"

MFS – JUL 2020 – L2 – Q6 – Financial Intermediation and Transformation Functions

Explain financial intermediation as a business and how transformation functions bridge gaps between lenders and borrowers.

You're reporting an error for "MFS – JUL 2020 – L2 – Q6 – Financial Intermediation and Transformation Functions"

EIB – APRIL 2023 – LEVEL I – Q6 – Financial Intermediaries and Banking Systems

This question covers naming financial intermediaries, defining bonds, conditions for effective central bank functioning, functions of commercial banks, reasons for adopting universal banking, and the extent of money supply expansion in banking systems.

You're reporting an error for "EIB – APRIL 2023 – LEVEL I – Q6 – Financial Intermediaries and Banking Systems"

BMF – Nov 2020 – L1 – SA – Q15 – Basics of Business Finance and Financial Markets

Identify why banks are considered important financial intermediaries.

You're reporting an error for "BMF – Nov 2020 – L1 – SA – Q15 – Basics of Business Finance and Financial Markets"

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