Essay On Financial Intuitions

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The role of financial intuitions
The main responsibilities of financial intuition to circulate economy by providing liquidity to the economy and permit a higher level of economic activity that would otherwise impossible. Banks accomplish this in three main ways: offering credit, managing markets and pooling risk among consumers. The most obvious source of the liquidity is provided by financial institutions which are the main source of available credit. The financial institute has another tool at their disposal as they provide liquidity. Buying and selling of securities are the way by which financial institution put them in the heart of the financial market. Still another way financial institution serves the market is by acting as repositories for risk by pooling the risk of commodities fluctuations, institutions that trade in derivatives can act to stabilize which can volatile markets. The smaller investors are protected by these form price fluctuations.
Functions in financial markets
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The present structure of the financial system in Bangladesh comprises of various types of banks, insurance companies, and non-bank financial institutions. Bangladesh Bank is at the top of the banking system and is accountable for assuring prudential administration and central banking activities for all types of banks, all of the banks are operating within a small industry where excessive competition has always existed. The prevailing market competition induces the banks to disburse loans without proper screening of the borrowers. Financial institutions serve the market is by acting as repositories for risk by pooling the risk of commodities fluctuations. An institution that trades in derivatives can act to stabilize markets. The financial institution is a shield of a financial system. For example, we can say, when there is inflation government provides money for a discount
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