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The Financial Services Industry and Its Ties to Corporate Finance
Financial services are actually the non-financial services offered by the financial industry, which covers a wide array of companies that deal with money, such as banks, credit card companies, mortgage companies, financial advisory firms, investment banks, and brokerage firms. Some people may be under the impression that financial services are only services for lending money and investing in stocks and property, but the truth is that this is not the case. There are also financial services that deal with financial minimization and planning, management of pension funds, risk management of financial portfolios and investments, and the provision of advice concerning estate planning and /or insurance. A financial service can also simply be any service that helps an individual or business to achieve its financial objectives, goals, and /or strategies.

The financial sector includes many different types of institutions, banks and financial companies. However, there are four main banks in the US: Bank of America, Chase Manhattan, Citibank, and Wells Fargo. Many financial institutions are "underwriter" banks that purchase assets for selling and trading them for profit - these include commercial real estate loans and mortgage loans. The "receiver" on the other hand, is the person or entity that takes the assets and uses them to fulfill their financial responsibilities. Many banks provide credit services such as credit cards, personal loans, etc.

The activities of financial institutions come under the jurisdiction of the Federal Deposit Insurance Corporation (FDIC). The FDIC is the sole regulator of United States banking institutions. The FDIC insures such financial institutions such as savings and loan, commercial banks, thrift associations, and other organizations from the risks associated with their activities. An example of such a financial institution would be the New York Federal Reserve, which is the central bank for New York City. The New York Fed is mandated by the US government to regulate all banking activities in the city and is part of the Department of Treasury.

The main regulatory bodies for the financial markets include the Federal Reserve, the FDIC, the Commodity Futures Trading Commission (CFTC), the National Credit Corporation (NCFC), and the Office of the Comptroller of the Currency and the Federal Reserve Board. Among these bodies, the Federal Reserve is considered as the leading regulator. The most important among these bodies are the Federal Reserve, the FDIC, and the NCFC. As stated above, all three bodies play an important role in the overall supervision of financial markets and provide crucial guidelines to financial institutions to ensure proper supervision.

Besides these three regulatory bodies, there are a number of primary governmental offices and agencies responsible for the supervision of financial activities. Some of these are the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, the Federal Reserve, and the Federal Housing Finance Agency. These government agencies directly regulate thousands of financial companies and investment advisors such as investment banking, and insurance firms. The indirect regulation refers to indirect regulation by watchdog organizations like the SEC, whose function is to monitor the activities of broker-dealers and other financial entities.

Apart from all these regulatory bodies and commissions, there are also informal arrangements made by mutual insurance companies and banks between them. Among these arrangements are the discount rate agreements, discount market component, and interest rate guarantee programs. Among these arrangements, the discount rate agreement is the most popular and most profitable incentive program that exists in the financial markets today. These discount rate agreements are usually between insurance companies and banking industry participants.

Another important aspect of the financial services industry is insurance. Insurance is basically an agreement between two parties where the insurer pays a particular premium based on a given risk level. This can either be between companies or between individuals or any combination thereof.

Other major activities covered by the financial system are: commercial real estate financing, foreign exchange, insurance, global economics, international trade, asset management, private equities, derivatives, cross borders transactions, and mortgage banking. While Digital Waves are very important in the overall financial system, they are nothing more than the tip of the proverbial iceberg. Therefore, it would be useful for a potential candidate for financial industry career to have an overview of the entirety of the subject. The main areas of focus of study that good finance major needs to master include: accounting, economics, banking, risk management, mergers and acquisitions, portfolio theory, securities law, portfolio management, and the economics of technology.
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