from the New York Fed
The financial intermediation industry has experienced two major developments in recent decades. First, a system that had commercial banks as central brokers providing all the services needed for the intermediation of funds has been progressively replaced by a much more complex, assembly-line system, with a multiplicity of entity types jointly involved in the completion of the intermediation process. This is what has become known as the system of shadow banking (e.g., Pozsar, Adrian, Ashcraft and Boesky, 2010, Financial Stability Board, 2011).
Parallel to this development, we have also observed a significant organizational transformation in banking firms; they have moved from being focused commercial bank entities and have become instead progressively very complex bank holding companies, with control over dozens and dozens (sometimes hundreds and even thousands) of subsidiaries, with depository institutions, in many instances, constituting only a small fraction of their entire organizational count (Avraham, Selvaggi and Vickery, 2012).