Again, banks and other depositories served an important safety-valve function for the commercial mortgage market. In figure 8, Federal Reserve flow of funds data are used to construct market shares of all financial intermediation provided by four major classes of institutions: banks, thrifts, insurance companies, and "other financial intermediaries," which range from finance companies to the entities that issue ABS.
9 In 1950, banks' share of financial intermediation (the red line) was about 50 percent; it declined and then rose to about 48 percent in the mid1970s, then it trended down to about 33 percent at the turn of the century. From the fourth quarter of 2007 to the fourth quarter of 2008, this measure of total financial intermediation grew by about 5 percent.