If we are able to rebuild the sophisticated relationship between firms and banks, eventually it may even be possible to present this as a “new” model for corporate finance. 4  BIS Review 43/2004  2. Hedging of risks  Firms are exposed to a wide range of risks in the form of foreign exchange risks, market risks, and credit risks of business counterparties.
Financial institutions play an important role in providing firms with financial services including hedging of risks. It is expected that the request for risk hedging tailored to the business profile will increase as business activities diversify further in the future. The development of financial theories and cutting-edge technologies has enabled financial institutions to hedge even extremely complex risks.