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MEXICO
Subttulo
INTRODUCTION
The globalization of financial markets has been based on several factors that
have enabled their integration Two of them are financial deregulation and
free movement of capital. Especially relevant to this change has been
technological progress regarding the connection between markets.
new innovative financial products have been developed. Their aim is to
provide protection from growing volatility and increased risk in all financial
transactions.
The negative side of globalization and the high interconnection between
markets is the contagion effect of financia l crises. The most recent example
is the sub-prime crisis.
BOND MARKET
The bond market was soon extended to the participation of
private companies. Thus, since the nineties, private companies,
public entities and government from the debtor, investment funds
from the creditor, and investment banks and rating agencies in a
dynamic relationship credit, modify flows and the relationship
again of the Mexican economy with international markets.
Banking System
In this situation, the Bank of Mexico was forced to intervene to prevent
systemic risk and manage the restructuring of the banking system. During the
nineties, the Mexican financial system changed radically. The new estructure is
characterized by three trends:
Following deregulation,
institutional investors,
particularly insurance
companies, pension funds
and capital market became
an important source of
financing.