Financial Intermediaries

Financial intermediaries are organisations which mediate between providers of capital and market participants with capital requirements.

Primarily, credit institutes such as banks and saving banks are understood to be intermediaries.  Additionally, there are investment companies, investment trusts and insurance companies. 

Example

In order to expand their operational framework through increased equity, companies offer shares and individuals who wish to invest their savings in a profitable way are interested in these shares. The prospective buyer can purchase shares through a bank which offers direct share trading.  An alternative is to invest in a fund-linked insurance.  In this way, financial intermediaries connect providers and buyers.

Within the framework of services, such as wealth management offered by asset management companies, a financial intermediary has tasks specified by the legislator.  This, among others things, includes the reporting obligation for derivative contracts in accordance with EMIR.