What changes are taking place in recent years? What role is being played by financial intermediaries in this change?

What changes are taking place in recent years? What role is being played by financial intermediaries in this change? 

Ans. Changes that are happening in financial markets can be summarized as follows: 

(a) Financial markets has expanded significantly in recent years, particularly stock market and bonds market. 

(b) Many new products have been launched in financial markets like swaps, options etc. 

(c) Share of mutual funds and pension funds have increased while that of insurance has decreased. 

(d) Most important change that has taken place is change in intermediaries’ activities that in the importance of risk management. 

(e) New types of non bank financial intermediaries have developed like GE capital which raises money entirely by issuing securities and not at all by taking deposits.