Please what is the use or importance of the stock exchange to the banking industry.?
Answer:
to make money. Sometimes you'll lose some!
i may not know the details..but i'll tell all i know
the banks invest in stocks too, so the changes in the stock market directly affects the banks' investments & revenues too
also, people can get loans from banks, by giving their shares as collateral security, so again, the changes in the stock market, would affect the amount of shares required to be deposited as security, that keeps the credit facility (based on stocks) very volatile
A stock exchange provides the means for a company's stock to be traded on the open market. It the the stock price goes up and the net assets of the company are up and if the propects for future growth are good; the company will have a good credit ratings. If the company has a good credit rating and needs to borrow from the bank or setup accounts to take care of other accounts, the bank will have a good customer.
kuntree gave a good answer. they work to together one benefits the other to make for the daily movement of money and investment to change hands in a secure efficient manner which helps the economy national and international.
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