... which deals with long term investments and borrowings and the money market which deals with short term funds. In addition, there is also the foreign exchange market and derivative market as well as financial intermediaries. Financial intermediaries fall into two categories: Banks and Non-Bank Financial Intermediaries (NFBI). These two categories of the financial system will be focused on in this research essay to fulfill our aim of comparing and contrasting Malaysia and Japan's banking and non-banking financial intermediary sector. Financial intermediaries are institutions that accept deposits and make loans. They deal with households, firms, and governments. Most financial intermediaries exist to make a profit for their shareholders. They to this by paying an interest rate to owners of deposits and charge borrowers a higher interest rate. The difference after paying overheads is their profit. The roles of financial intermediaries are to transfer money from lenders to borrowers, mobilization and pooling ...

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