FINANCIAL MARKETS Financial markets A Financial Market is an institution or arrangement that facilitates the exchange of financial assets. They are mechanisms in our society for converting public savings into investments such as buildings, machinery, infrastructure and inventories of goods and raw materials. This enables the economy to grow, new jobs to be created and…
Read MoreExisting financial sector regulatory framework in Kenya Existing financial sector regulatory framework in Kenya The existing regulatory framework for the financial sector in Kenya consists of a number of independent regulators each charged with the supervision of their particular sub sectors. The creation of the Insurance Regulatory Authority completed the shift from having departments under…
Read MoreFINANCIAL SECTOR REGULATION IN KENYA The rationale for regulation Financial systems are prone to periods of instability. In recent years, a number of financial crises around the world (South-east Asia, Latin America and Russia, Global financial crisis) have brought about a large number of bank failures. Some argue that this suggests a case for more…
Read MoreFINANCIAL INSTITUTIONS AND CAPITAL MARTKETS Pensions Sub sector a) Pension: Money paid regularly to retired employees or their survivors by private businesses, federal state and local governments. They are paid inform of a guaranteed annuity to a retired or disabled employee. b) Pension schemes These are funds set up by co-operations e.g.(NSSF), labour unions, Government…
Read MoreFINANCIAL INSTITUTIONS AND CAPITAL MARTKETS Stock Market (S.E) A stock exchange can be defined as the organized capital markets for securities which may be in form of shares, bonds, debentures, etc which are bought and sold through brokers who act as intermediary between the buyers and sellers of securities. Nairobi stock market came into existence…
Read MoreFINANCIAL INSTITUTIONS AND CAPITAL MARTKETS Microfinance sub-sector Microfinance entails the provision of financial services to low income people and enterprises. This underscores the crucial role of microfinance in empowering the Underprivileged social constituencies, and particularly women, to contribute more effectively to economic development and poverty reduction in Kenya. The Microfinance industry in Kenya has experienced…
Read MoreFINANCIAL INSTITUTIONS AND CAPITAL MARTKETS Banking Services through Subsidiaries a) Investment Management Services For many commercial banks, investment management is a major revenue producer. Although they are prohibited from making certain investments in corporate securities for their own accounts, banks manage billions worth of securities for wealthy individuals, corporate clients, and various kinds of retirement…
Read MoreFINANCIAL INSTITUTIONS AND CAPITAL MARKETS Investment banking Investment bank is a banking institution that performs various functions not limited to the following: advising, administration, underwriting, and distribution. These services are performed as part of the basic investment banking business and are central to any firm. A detailed description of these functions is clearly outlined below.…
Read MoreINTRODUCTION TO FINANCIAL INSTITUTIONS AND CAPITAL MARKETS The Five Parts of the Financial System 1. Money: Anything generally accepted as a means of payment or medium of exchange. It’s useful because you can exchange goods or services with it, either now or later (non-perishable, store of wealth. Contrast with, say, fish). 2. Financial Instruments: A…
Read MoreINTRODUCTION TO FINANCIAL INSTITUTIONS AND CAPITAL MARKETS Introduction The economic development of any country depends, upon the existence of a well organized financial system. It is the financial system which supplies the necessary financial inputs for the production of goods and services which in turn promote the well being and standard of living, of the…
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