Commercial bank
A financial institution that accepts deposits from the public and provides loans and other services to individuals and businesses.
Fractional-reserve banking: A banking system in which banks hold only part of deposit liabilities as reserves and lend the rest. Explains how commercial banks can extend credit while keeping funds available for withdrawals.
Bank: A financial institution that holds money, extends credit, or provides payment services. Commercial banks are one major kind of bank, distinct from central and investment banks.
Retail banking: Banking services offered to individuals and households, including deposits, cards, and personal loans. It covers the consumer-facing side of commercial banking.
Central bank: A public institution that manages a nation’s currency, monetary policy, and core banking-system functions. Unlike commercial banks, it sets monetary conditions and commonly serves as lender of last resort.
Deposit insurance: A government-backed guarantee that protects eligible bank deposits up to a specified limit. It reduces depositor losses and the incentive to withdraw funds during panic.
Bank reserves: Cash and central-bank balances that banks hold to meet payments and regulatory requirements. These assets help banks settle withdrawals and transfers without liquidating loans.
Bank deposit: Money placed with a bank, recorded as a liability the bank owes to the depositor. Customer deposits are a principal source of commercial-bank funding.
Business banking: Banking services for businesses, including accounts, payments, cash management, and loans. Commercial banks support firms’ day-to-day finances and investment.
Investment bank: A financial institution that advises on securities issuance, mergers, acquisitions, and other capital-market transactions. Its core business is capital-market intermediation rather than taking ordinary public deposits.
Bank regulation: Rules and supervisory practices governing banks’ safety, conduct, and financial reporting. Regulation constrains risk-taking and sets standards for capital, liquidity, and consumer protection.