THEORIES REGARDING FINANCIAL INTERMEDIATION AND FINANCIAL INTERMEDIARIES – A SURVEY

In this paper we propose to make a presentation of the m ain theories on financial intermediation and financialintermediaries. Modern theory of financial intermediation examine the main functions of financial intermediation, howthe financial intermediation affect the economy as a whole and the effects of gover nment policies on financialintermediaries. We will focus on issues of function of financial intermediaries, such as reduction of transaction costs,liquidity provision, information provision, debt renegotiation.