Fundamental functions of the financial system and regulation
Author(s): Emilios Avgouleas
Institution: University of Manchester
Date produced: 2011
The operation of the financial system serves a host of very important economic functions. On the one hand, savers deposit their surplus money with banks. On the other hand, private and public actors can finance, by means of bank loans, their consumption and investment needs. For this reason the sound and safe operation of the banking system is of strategic importance not only in fostering economic development but also in ensuring social and economic stability.