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The Banking System

  • Peter Curwen
Chapter
Part of the Macmillan Texts in Economics book series (TE)

Abstract

The UK financial services sector (wholesale and retail) generates roughly 6.5 per cent of UK GDP. It is responsible, for example, for 75 per cent of the world’s secondary trading in international bonds; 60 per cent of its international bond issues; 60 per cent of its foreign equities turnover; and 27 per cent of its foreign exchange turnover. As this suggests, the overall financial system in the UK is the most sophisticated in Europe and bears comparison only with that of the USA, albeit on a much smaller scale overall. For this reason, it is necessary to divide it up for analytical purposes into that part which comes under the heading of ‘banking’ and that part best described as ‘non-banking’. Until fairly recently, this distinction would have been clear-cut and uncontroversial. As we shall see in what follows, the traditional distinction has become increasingly blurred of late, particularly in the light of the change in status of certain former building societies. To begin with, however, we need to examine certain aspects of their behaviour which are common to all financial intermediaries.

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Copyright information

© Peter Curwen 1997

Authors and Affiliations

  • Peter Curwen

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