The main financial institutions are:
?
- banks
- investment banks
- finance companies
- life insurance companies
- superannuation funds
- unit trusts
- Australian Securities Exchange.
Banks:
- the role they play as a (financial institution) :
? - the most important source of funds for businesses.
- Banks receive savings as deposits from individuals
- and, in turn, make investments and loans to borrowers.
Investment banks:
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- Investment banks provide services in both borrowing and lending, primarily to the business sector
Finance companies:
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- Finance companies are non-bank financial intermediaries that specialise in smaller commercial finance.
- They provide mainly short-term and medium-term loans to businesses
- Finance companies raise money through share issues (debentures)
Life insurance companies:
?
- Life insurance companies are non-bank financial intermediaries who provide cover and a lump sum payment in the event of death.
Superannuation funds:
- superannuation is :: a scheme set up by the federal government, which requires all employers to make a financial contribution to a fund that will provide benefits to an employee when they retire
Unit trusts:
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- (also known as mutual funds)
- Unit trusts take funds from a large number of small investors and invest them in specific types of financial assets.
Australian Securities Exchange:
- The Australian Securities Exchange (ASX) is :: the primary stock exchange group in Australia
- The ASX functions as a market operator, clearing house and payments system facilitator.
- Importantly for businesses, the ASX acts as a primary market.
- a primary market deals with :: the new issue of debt instruments by the borrower of funds
- The ASX also operates as a secondary market.
- a secondary market deals with :: the purchase and sale of existing securities