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Credit risk is inherent in the business of banking, but additionally, these institutions are exposed to counterparty credit risk. The financial services sector is one of the most important segments of the economy. It drives a nation’s economy, providing the free flow of capital and liquidity in the marketplace. It is made up of a variety of financial firms, including banks, investment houses, finance companies, insurance companies, lenders, accounting services, and real estate brokers. In Lebanon, the Innovative Small and Medium Enterprises project is a $30 million investment lending operation providing equity co-investments in innovative young firms in addition to a grant funding window for seed stage firms. To date, 60 out of 174 grantees had leveraged the iSME funding to raise a total of $13.1 million from various funding sources, a leverage ratio of 5.3 times. Understanding Finance Financial managers—who create financial reports, direct investment activities, and develop plan...