BU111 Lecture Notes - Money Supply, Life Insurance, Toronto Stock Exchange
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BU111 Full Course Notes
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Document Summary
Canadian financial system: understand its purpose, describe its structure and organization. Four pillars & bank of canada: discuss changes in banking. International banking & finance: understand purpose, structure and key organizations. Financial institutions facilitate flow of money: moving money from where there is a surplus of money to where there is a need. Four distinct legal areas/ pillars : chartered banks largest and most significant, alternate banks life insurance companies investment dealers. Lines between pillars have been blurred due to deregulation. Largest and most important institution: five largest account for 90% of total bank assets, bank act limits foreign-controlled banks to <8% of total domestic bank assets. Major source of short-term loans for business: secured vs. unsecured loans. Expanded money supply through deposit expansion: when money is deposited in a bank, the bank can invest it else where, or they loan it out to other people. Manages economy and regulates aspects of chartered bank operations.
