A bank is a financial institution licensed to receive deposits and make loans.

A place where people deposit their savings, receive loans, and banks are also used as a location where salaries are pain in into people’s accounts.

Banks may also provide financial services, such as wealth management, currency exchange and safe deposit boxes.

There are two types of banks: commercial/retail banks and investment banks. In most countries, banks are regulated by the national government or central bank.

BREAKING DOWN ‘Bank’

Commercial banks are typically concerned with managing withdrawals and receiving deposits as well as supplying short-term loans to individuals and small businesses.

Consumers primarily use these banks for basic checking and savings accounts, certificates of deposit (CDs) and home mortgages.

Examples of commercial banks include JPMorgan Chase & Company and Bank of America Corporation.