FINANCIAL INSTITUTIONS

• FINANCIAL INSTITUTIONS


  are companies in the financial sector that provide a broad range of business and services including banking, insurance, and investment management.
• COMMERCIAL BANKS


  Individuals deposit funds at commercial banks, which use the deposited funds to provide commercial loans to firms and personal loans to individuals, and purchase debt securities issued by firms or government agencies.
• INSURANCE COMPANIES


  Individuals purchase insurance (life, property and casualty, and health) protection with insurance premiums. The companies pool these payments and invest the proceeds in various securities until the funds needed to pay off claims by policyholders. Because they often own large blocks of a firm’s stocks or bonds, they frequently attempt to influence the management of the firm to improve the firm’s performance, and ultimately, the performance of the securities they own.
• MUTUAL FUNDS


  owned by investment companies that enable small investors to enjoy the benefits of investing in a diversified portfolio of securities purchased on their behalf by professional investment managers. When these funds use money from investors to invest in newly issued debt or equity securities, they finance new investment by firms. Conversely, when they invest in debt or equity securities already held by investors, they are transferring ownership of the securities among investors.
• PENSION FUNDS


  Financial institutions that receive payments from employees and invest the proceeds on their behalf.
• Other financial institutions include pension funds like Government Service Insurance System (GSIS) and Social Security System (SSS), unit investment trust fund (UITF), investment banks, and credit unions, among others.