Five fundamental forces have transformed the structure of financial markets and institutions and reflect the intense competition financial firms face today: deregulation/reregulation, financial innovation, securitization, globalization, and advances in technology. Market participants can choose from a larger number of suppliers which places a premium on customer service. To remain competitive, banks should identify the products with which they have a market advantage and provide personal service. The basic theme is that increased competition, brought about not only by continued deregulation but also as financial firms find ways around regulation, has encouraged banks to assume increased portfolio risks in order to earn acceptable returns.deregulation/reregulation, financial innovation, securitization,globalization, advances in technology
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