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Wikipedia

Shadow banking system

The shadow banking system is a term for the collection of non-bank financial intermediaries that provide services similar to traditional commercial banks but outside normal financial regulations. Former US Federal Reserve Chair Ben Bernanke provided the following definition in November 2013:

Shadow banking has grown in importance to rival traditional depository banking, and was a primary factor in the subprime mortgage crisis of 2007-2008 and the global recession that followed. Valerio Lemma, an associate professor of Banking Law who consults on regulatory compliance, argues that the lack of regulatory supervision of the shadow banking system is a market failure.

Wiktionary

shadow banking system

n. (context pejorative banking finance economics English) Non-bank financial institutions, that, like banks, borrow short and in liquid forms and lend or invest long in more illiquid assets.