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Has the importance of foreign nonbank financial lending been increasing or decreasing in recent years? Provide...

Has the importance of foreign nonbank financial lending been increasing or decreasing in recent years? Provide some examples to back up your answer.

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Expert Solution

Foreign non banking financial lending have been increasing because these kinds of non banking business are less regulatory in nature and they are also providing with interest rate which are highly cost efficient.

there are following reasons for increasing of importance of foreign non banking financial lending-

A.lessor requirements to follow the rules and regulations and litigations because they are not engaged in banking activities

B. They are not also guided by the monetary policies and they are offering lower rate of interest on the overall loan.

C. They will be landing aggressively at lower rates in order to gain from global exposure

D. These kinds of banking does not have branches in the domestic country mostly so they will not be easily trailed by the regulatory authorities.

It can be exampled that various businesses are trying to borrow through other countries non banking financial institution as their providing with benefits in the fluctuation from the interest rate as well as fluctuations from change in the monetary policy and the lower rate of interest and it can be reflective in various countries balance sheet in United States itself.

jeff jeffy answered 1 year ago
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