Balance Sheet and Regulatory Features Paper

m onetary institutions offer a wide crop of expediencys that vary in monetary value of trans bearions, clients, packaging, volume and other parameters. Among them atomic number 18 the siting securities firms, banks and insurance companies. In general, they all fargon the essential function of channeling pecuniary resource from those with waste silver to those with shortages of storages (Saunders & Cornett, 2003). Then as they progress with their respective financial products, services, and tail end markets, then their roles in the financial population become more apparent. Investment Securities FirmsInvestment securities firms figure out as brokers and sell securities such as company stocks, commercial papers and promissory notes as well as government-issued treasury bills. They assist individuals who postulate to purchase juvenile or existing securities issues or who want to sell previously purchased securities (Melicher & Norton, 2003). Full service of these firms for individual clients would include doing research on securities available for them to invest in and interpretation advisory services by grown clients timely information and recommendations based on it (Saunders & Cornett, 2003).These they do also for corporate clients that leafy vegetable some of their idle company funds in securities both fixed-income securities and stocks. These firms charge management and service fees for their services, and this is basically how they generate their income. bank deposit Institutions While coronation securities firms are non-depository institutions, those that are designated as depository institutions can gestate deposits from retail savers. They include banks, savings institutions and assent unions (Saunders & Cornett, 2003).While non-depository institutions plainly act as intermediaries of funds from the sources (the investors and the savers) to the users (the companies needing additional working capital to fund their operations, etc. ), depository institutions can act both as intermediaries and as custodians of the specie entrusted to them. When an investor goes to an investment securities firm to either bargain stocks or to put some cash in commercial papers, they know that their funds is placed in the company that issued the securities (stock or debt instruments).They will on that pointfore be concerned with the financial well-being of the securities issuer, and not so much the investment securities firm. This is because the company primarily responsible for the safety of the value and the income of their money is the same company that issued the securities they invested in. In contrast, when an investor goes to a depository institution like a bank to leave their money there for safekeeping until they would need to use it or to invest it elsewhere, the same investor is placing his trust and self-assertion in the depository institution.He, therefore, believes that the institution is financially sound an d that putting his money in their custody is a safe move. The institution, in turn, accepts the deposits and stands to be responsible for them. In behalf of their depositors, then, they invest the pooled deposits elsewhere and lend them to qualified borrowers. fiscal Intermediaries Financial intermediaries generally include banks, investment securities firms, investment banks, insurance companies and pension funds.They are grouped into three categories the depository institutions (banks), the contractual savings institutions (insurance companies) and investment intermediaries (mutual funds). These entities stand betwixt the lender-savers and the borrower-spenders and facilitate the transfer of funds from one to the other. (Mishkin, 2001) They receive money and pass them on as investments, subject to their respective agreements or transaction contracts with their clients.