BU111 Lecture Notes - Lecture 17: Canada Savings Bond, Secured Loan, Trust Company
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Four pillars: chartered banks businesses such as td, world bank, bmo. Privately owned firm that serves individuals, businesses, etc. Major source of short-term loans for businesses (under 5 years). Secured: consent to selling of personal assets in order to if you don"t pay them back. Unsecured: backed only by the borrower"s promise. , Highly regulated industry: alternate banks trust companies such as canada trust and credit unions. Before you could lend and borrow from them but they were unpopular/untrustworthy so they died out. Credit union: cooperative saving and loaning associations formed by a group of people with common interests. When you do things with cu"s, you"re a member of that union. When the union generates profits, you get dividends: specialized lending/saving intermediaries life insurance companies is an example. You pay premiums to the insurance companies, hence they share risk with policyholders for premium. They then invest and profit from the money by lending it, your premiums grow.
