shadow banking system

noun

Non-bank financial institutions, that, like banks, borrow short and in liquid forms and lend or invest long in more illiquid assets.

“Meronym: private credit”

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Meanings

nounshadow banking system (plural shadow banking systems)

plural shadow banking systems

  1. derogatorybankingNon-bank financial institutions, that, like banks, borrow short and in liquid forms and lend or invest long in more illiquid assets.

    Meronym: private credit

    1 more example

    Given the Chinese banking sector's predominance in the economy, it seems surprising that China appears to need another, parallel, shadow banking system.

    2016, Ning Zhu, China's Guaranteed Bubble […] , McGraw Hill, →ISBN, page 35

Origin

Coined by Paul McCulley in 2007. Parallel with earlier constructions such as shadow cabinet and shadow government as names for quasi-institutions running unofficially in parallel with the official institutions.

Full word history & related roots →
Cite this entry
APA

shadow banking system. (n.d.). In WatkinsX Dictionary. Retrieved November 4, 2026, from https://dictionary.watkinsx.com/word/shadow%20banking%20system

MLA

“shadow banking system.” WatkinsX Dictionary, https://dictionary.watkinsx.com/word/shadow%20banking%20system. Accessed November 4, 2026.

Chicago

WatkinsX Dictionary, s.v. “shadow banking system,” accessed November 4, 2026, https://dictionary.watkinsx.com/word/shadow%20banking%20system.

Source: shadow banking system on Wiktionary, CC BY-SA 4.0.