intermediation


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Related to intermediation: Financial intermediation

Intermediation

Investment through a financial institution. Related: Disintermediation.

Intermediation

A situation in which a financial institution stands between counterparties in a transaction. For example, in the sale of a house, a bank usually serves as a financial intermediary by providing a mortgage to the buyer to pay the seller. In some non-traditional transactions, a bank may buy a product (e.g. corn) and immediately re-sell it for a profit to a third party. Most transactions requiring a loan to one of the parties include intermediation. See also: Murabaha.

intermediation

The flow of funds through financial intermediaries (such as banks and thrifts) on its way to borrowers. Money deposited at financial institutions that make the money available to corporate borrowers is an example of intermediation. This process tends to facilitate saving and investing in sophisticated financial systems. Compare disintermediation.

intermediation

the role of financial institutions such as COMMERCIAL BANKS and BUILDING SOCIETIES as intermediaries in channelling funds from lenders to borrowers.

intermediation

the role of the financial institutions in channelling SAVINGS and other deposits by LENDERS to BORROWERS. Financial intermediaries such as COMMERCIAL BANKS and BUILDING SOCIETIES accept deposits from individuals and businesses and use these funds to make LOANS to creditworthy customers. An intermediary's profit is the difference between INTEREST RATES paid for deposits and interest rates on loans. See FINANCIAL SYSTEM, DISINTERMEDIATION.

intermediation

The normal flow of money into financial institutions in the form of deposits,which are then loaned out to earn income.Contrast with disintermediation,which occurs when depositors take their money out of financial institutions because they can earn more money,relatively risk free, in other investments.

References in periodicals archive ?
Securitization-based credit intermediation potentially increases the efficiency of credit intermediation.
We interpret a reduction in intermediation costs as an improvement in the financial intermediation technology or a reduction in taxes on financial transactions.
This view, however, conflicts with that of Calomiris (1995), who argued that, in comparison to the cost of intermediation in American banks, the cost in Germany was very low.
All told, predicting either the share of depository intermediation in overall credit flows or the share of money in the public's overall demand for financial assets is currently more difficult than usual.
The crisis has therefore exposed significant instances of financial intermediation failure but also an apparent disconnect between financial intermediation activity and banks.
Yet, despite the theoretical rhetoric on the importance of financial intermediation to output fluctuations, the empirical relevance of financial intermediation remains an unsettled question.
Centerbrook Financial LLC ("Centerbrook") is a provider of credit intermediation products, including credit default swaps, to the affordable housing finance industry.
This transaction represents only the initial phase of our credit intermediation business," commented Marc D.
The Company is continuing to work closely with IXIS to increase CharterMac's market share in the credit intermediation industry.
The transaction also includes a $350 million credit intermediation agreement between CalBear and CES.
00), within the United States, to finance operations that fall within the existing rules of the different types of financial intermediation programs CABEI.
NASDAQ:NETM), a software company that provides solutions for accessing, Web enabling and integrating enterprise information systems, today announced that Xcalia, a leading provider of business integration software, has embedded NetManage Librados adapters into their Xcalia Intermediation Platform(TM).