What are private financial institutions?
Private financial institutions are entities such as banks and hedge funds that are owned exclusively by shareholders, without government share. These entities are still subject to government regulation and supervision, but work with regard to various final missions. Their primary responsibility is their shareholders, unlike public institutions that have a public service mission, often focused on development. Public financial institutions are owned by the government completely or partially and may include more government investors in the case of organizations such as the World Bank.
positions occupied by shareholders may vary. In the credit union cooperative, every customer is also a shareholder with the number of shares of the specified amount of deposit. The credit credit union is obliged to generate revenues for their customers, who also have the opportunity to vote on the officers and politicians of the Cooperative Backup. This model may also include a link to another entity, such as the company for its employees. These organizations invest fiNancial funds to provide revenues to shareholders and can offer their customers benefits such as interest in savings accounts. These private financial institutions can also participate in activities such as investments of shareholders in shares, bonds and other financial instruments to make profits.
Such institutions can offer their shareholders various benefits. In some cases, the number of shareholders in private financial institutions may be limited; For example, a single family could have a majority stake in the bank and the sale of shares can be limited. Others have shares traded in an open market and can have large shareholders thanks to dividends and new questions. Shareholders can receive dividends for their shares and have the opportunity to vote in the elections to determine the shape of the institution's policies.
Numerous regulations cover operations in private financial institutions. These include protection requirementsY Securing information about members as well as legal requirements concerning funds in the area of reserves and other matters. These organizations are not responsible for the public as public institutions, but are subject to control to limit the possibility of financial panic and crises that could create a ripple. On the other hand, a public financial institution, such as a development agency, must provide funds for public work, publish information about their activities and work with regard to public good.