The UK financial system presents a comprehensive explanation of the workings of the institutions and markets which make up the UK financial system, and discusses the issues affecting them. It presents key theoretical developments such as asymmetric information, the efficient markets hypothesis, behavioral economics and the term structure of interest rates, thus providing an analytical framework to aid understanding of the institutional structure. INDICE 1. Introduction to the Financial System 2. Financial intermediation and recent developments in the UK system 3. Retail banking 4. Wholesale and international banking 5. Building societies and financial houses 6. Investment institutions 7. Financial markets: Introduction 8. The market for equities 9. Interest rates and the bond market 10. The sterling money markets 11. The foreign exchange market 12. Eurosecurities markets 13. Financial derivative 14. Managing risk via financial markets 15. The efficiency of the UK financial system 16. Central banking 17. Regulation of the financial system 18. Conclusions