A bank is a financial institution that accepts deposits from the public and creates a demand deposit while simultaneously making loans. Lending activities can be directly performed by the bank or indirectly through capital markets.
Whereas banks play an important role in financial stability and the economy of a country, most jurisdictions exercise a high degree of regulation over banks. Most countries have institutionalized a system known as fractional-reserve banking, under which banks hold liquid assets equal to only a portion of their current liabilities. In addition to other regulations intended to ensure liquidity, banks are generally subject to minimum capital requirements based on an international set of capital standards, the Basel Accords. (Full article...)
Fractional-reserve banking is the system of banking in all countries worldwide, under which banks that take deposits from the public keep only part of their deposit liabilities in liquid assets as a reserve, typically lending the remainder to borrowers. Bank reserves are held as cash in the bank or as balances in the bank's account at the central bank. Fractional-reserve banking differs from the hypothetical alternative model, full-reserve banking, in which banks would keep all depositor funds on hand as reserves.
The country's central bank may determine a minimum amount that banks must hold in reserves, called the "reserve requirement" or "reserve ratio". Most commercial banks hold more than this minimum amount as excess reserves. Some countries, e.g. the core Anglosphere countries of the United States, the United Kingdom, Canada, Australia, and New Zealand, and the three Scandinavian countries, do not impose reserve requirements at all. (Full article...)
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In finance, a loan is the transfer of money by one party to another with an agreement to pay it back. The recipient, or borrower, incurs a debt and is usually required to pay interest for the use of the money.
The document evidencing the debt (e.g., a promissory note) will normally specify, among other things, the principal amount of money borrowed, the interest rate the lender is charging, and the date of repayment. A loan entails the reallocation of the subject asset(s) for a period of time, between the lender and the borrower. (Full article...)
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A cheque (or check in North American English; see spelling differences) is a document that orders a bank, building society (or credit union) to pay a specific amount of money from a person's account to the person in whose name the cheque has been issued. The person writing the cheque, known as the drawer, has a transaction banking account (often called a current, cheque, chequing, checking, or share draft account) where the money is held. The drawer writes various details including the monetary amount, date, and a payee on the cheque, and signs it, ordering their bank, known as the drawee, to pay the amount of money stated to the payee.
Although forms of cheques have been in use since ancient times and at least since the 9th century, they became a highly popular non-cash method for making payments during the 20th century and usage of cheques peaked. By the second half of the 20th century, as cheque processing became automated, billions of cheques were issued annually; these volumes peaked in or around the early 1990s. Since then cheque usage has fallen, being replaced by electronic payment systems, such as debit cards and credit cards. In an increasing number of countries cheques have either become a marginal payment system or have been completely phased out. (Full article...)
In addition to the bill payment facility, most banks will also offer various features with their electronic bill payment systems. These include the ability to schedule payments in advance to be made on a specified date (convenient for installments such as mortgage and support payments), to save the biller information for reuse at a future time and various options for searching the recent payment history. In many cases the payment data can also be downloaded and posted directly into the customer's accounting or personal finance software. (Full article...)
ATMs are known by a variety of names, including automatic teller machines (ATM) in the United States (sometimes redundantly as "ATM machine"). In Canada, the term automated banking machine (ABM) is also used, although ATM is also very commonly used in Canada, with many Canadian organizations using ATM rather than ABM. In British English, the terms cashpoint, cash machine and hole in the wall are also used. Other terms include any time money, cashline, tyme machine, cash dispenser, cash corner, bankomat, or bancomat. ATMs that are not operated by a financial institution are known as "white-label" ATMs. (Full article...)
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A bank card is typically a plastic card issued by a bank to its clients that performs one or more of a number of services that relate to giving the client access to a bank account.
Physically, a bank card will usually have the client's name, the issuer's name, and a unique card number printed on it. It will have a magnetic strip on the back enabling various machines to read and access information. Depending on the issuing bank and the preferences of the client, this may allow the card to be used as an ATM card, enabling transactions at automated teller machines; or as a debit card, linked to the client's bank account and able to be used for making purchases at the point of sale with a bank card using a payment terminal. Later, in 2010s, smart card technology was adopted for bank card. (Full article...)
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Community development bank (CDB) or Community Development Financial Institution (CDFI) is a development bank or credit union that focus on serving people who have been locked out of the traditional financial systems such as the unbanked or underbanked in deprived local communities. They emphasize the long term development of communities and provide loans such as micro-finance or venture capital.
In the United States these became popular after 1994 when the US Congress created community development banks and allowed them to get funding at very low rates from the US treasury. (Full article...)
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The CAMELS rating is a supervisory rating system originally developed in the U.S. to classify a bank's overall condition. It is applied to every bank and credit union in the U.S. and is also implemented outside the U.S. by various banking supervisory regulators.
In the past, the custodian bank purely focused on custody, safekeeping, settlement, and administration of securities as well as asset servicing such as income collection and corporate actions. Yet, in the modern financial world, custodian banks have started providing a wider range of value-adding or cost-saving financial services, ranging from fund administration to transfer agency, from securities lending to trustee services. (Full article...)
On 14 September 2022, State Bank of India became the third lender (after HDFC Bank and ICICI Bank) and the seventh Indian company to cross the ₹5 trillion market capitalization on the Indian stock exchanges for the first time. The largest public lender in the country reached a milestone in April 2024, when its market capitalization surpassed ₹7 trillion, making it the second public sector undertaking (PSU) to do so, after Life Insurance Corporation of India. In June 2024, SBI crossed all time high market capitalisation of ₹8 trillion (8 lakh crore INR) becoming the 7th Indian company to cross this milestone, and third Indian bank after HDFC and ICICI in terms of market capitalisation. As of August 2024, State Bank of India has a market cap of ₹7.276 Trillion. This makes it the world's 200th most valuable company by market cap. The Reserve Bank of India (RBI) has identified SBI, HDFC Bank, and ICICI Bank as Domestic Systemically Important Banks (D-SIBs), which are often referred to as banks that are "too big to fail". (Full article...)
Many subsidiaries, such as Abbey National, have been rebranded under the Santander name. The company is a component of the Euro Stoxx 50stock market index. In June 2023, Santander was ranked as 49th in the Forbes Global 2000 list of the world's biggest public companies. Santander is Spain's largest bank. (Full article...)
Image 36Statesman Jan van den Brink was instrumental in the merger of Amsterdamsche Bank and Rotterdamsche Bank in 1964, and remained on the bank's board until 1978 (from AMRO Bank)
Image 37This 15th-century painting depicts money-dealers at a banca (bench) during the Cleansing of the Temple. (from Bank)
Image 38An illustration of Northern National Bank as advertised in a 1921 book highlighting the opportunities available in Toledo, Ohio (from Bank)