ABSTRACT
The term ‘financial intermediation’ is generally used to describe the financial service industry’s role as a middleman between the ultimate saver and the ultimate investor (financial intermediation I). The impact of globalisation on this first type of intermediation and vice versa has been widely and controversially discussed among bankers, supervisors, politicians, and academics. Without commenting further on this issue, it is sufficient to say that globalisation of financial intermediation and markets can reduce the cost of capital in different ways and thus contribute to the economic wealth of the world (Stulz 1999).
