Regulation of financial markets and interest rates Australia's financial system was once divided into banks and non-banks, however this convention has disappeared over time and now many financial intermediaries offer almost all services banks do. However, as banks still control the majority of the financial system, they remain the most important asset to the financial system. One of the two major changes Australia's financial system has undergone through recent decades is the involvement of financial …showed first 75 words of 697 total…

…showed last 75 words of 697 total…Similarly when making loans financial institutions charge a rate of interest known as the lending rate. Profit is made in the financial sector, when the lending rate exceeds the borrowing rate. Short and long term interest rates depend on the length to maturity of financial assets or securities. Short term interest securities can include Treasury notes issued for 13 or 26 weeks while long term securities can include treasury bonds that can be issued for 5,7 or 10 years.