Types Of Banks

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A bank is a financial intermediary that accepts deposits and channels those deposits into lending activities, either directly by loaning or indirectly through capital markets. A bank links together customers that have capital deficits and customers with capital surpluses.

Due to their importance in the financial system and influence on national economies, banks are highly regulated in most countries. Most nations 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, known as the Basel Accords.

"A banker ... is a trader who buys money, or money and debts, by creating other debts, which he does with his credit - exchanging for a debt payable in the future one payable on demand…………….. the United States Supreme Court (Austen)

"A banker (is) a dealer in capital, or, more properly, a dealer in money. He is an intermediate party between the borrower and the lender. He borrows of one party and lends to another."……….. the United States Supreme Court (Austen)

Banking: In general terms, the business activity of accepting and safeguarding money owned by other individuals and entities, and then lending out this money in order to earn a profit.

Classification of banks: (Ownership Basis)

State Owned bank: A public bank is a bank, a financial institution, in which a state or public actors are the owners. It is a company under state control.

Private Banks are banks owned by either an individual or a general partner(s) with limited partner(s). Private Banks are not incorporated. In any such case, the creditors can look to both the "entirety of the bank's assets" as well as the entirety of the sole-proprietor's/general-partners' assets.

There were many private banks in Europe, but most have now become incorporated companies, so the term is rarely true anymore. Today, the term "private bank" can also refer to the financial institution specializing in financial advice and services for high-net-worth individuals (private