Types of banks ������

What is a bank? 

A bank is a financial institution that accepts deposits from the public and creates demand deposits. Alexander Hamilton started the idea of banking to handle the colossal bank debt. Upto the time of bank charter, coins and bills issued by state bank worked as currency. The oldest bank is called Banca Monte dei Paschi di Siena, headquartered in Siena, Italy. It has been operating since 1472. 

Banks are involved in borrowing and lending money. Banks take customers deposits in return for paying customers an annual interest payment. Then the banks use the customer's deposits to lend to other customers for a variety of loans. There are different types of banks and the following are the types of banks we are going to learn about today. 

Commercial banks

Exchange banks

Industrial banks

Agricultural or corporate banks

Savings banks

Central banks

Commercial bank: This is a type of bank that accepts deposits such as accepting deposits, making business loans and offering basic investment for profit. The Commercial Bank was founded in 1924 by local businessmen in Oglethorpe County with the mission of serving the financial needs of the citizens and businesses of the area. Some of the examples of Commercial banks include Wells Fargo, chase, capital one and bank of America

Exchange bank: An exchange bank is a community bank offering personal and business banking services such as  mortgages, home loans and lines of credit and SBA loans. An exchange bank in Milledgeville, Georgia, was chartered on May 20, 1903, and began business on June 3, 1903 in a building located at 120 West Hancock Street. On the August of 1907, its bank offices were re allocated to 100 East Hancock Street and occupied the street level of the Masonic Building. Examples of exchange banks include Citigroup, American Express Bank Ltd, Bank of Nova Scotia and Barclays Bank

Industrial bank: It is a financial institution with limited services and sell certificates called investment shares and accepts customer deposits which are invested as funds in instalment loans for consumers and small enterprises. Jesse H. Mitchell opened the doors of Industrial Bank for the first time in August 20th 1934, the bank since then has delivered essential banking and financial services which have contributed greatly to the growth and development of the Washington, DC community. Some of the examples of Industrial banks include Balboa Thrift and Loan Association, Beal Bank USA, BMW Bank of North America and Celtic Bank

Agricultural bank: This is a type of bank that lends money to farmers for longer periods of time and charges them less interest than other types of banks. The first Agricultural bank is traced to the establishment of Nigerian Agriculture Bank (NAB) in 1973. NAB was a government initiative to fund agriculture development projects in the country, in particular small-scale farm holders that may not have enough collateral to obtain credit facilities from commercial banks. Some of the best Agricultural banks include Farm Credit Services of America (ACA), Farm Credit Mid America (ACA), MetLife Insurance and Rabo Agrifinance / Rabo Bank NA. 

Savings banks: A savings bank is a financial institution whose primary purpose is accepting savings deposits and paying interest on those deposits. They originated in Europe during the 18th century with the aim of providing access to savings products to all levels in the population. Some of the examples of savings banks include Chase, Navy Federal Credit Union, Axos Bank and Wells Fargo.

Central Banks: A central bank, reserve bank, or monetary authority is an institution that manages the currency, money supply, and interest rates of a state or formal monetary union, and oversees their commercial banking system. The Swedish Riksbank was the first central bank which was established in 1668 as a joint stock bank. It was chartered to lend the government funds and to act as a clearing house for commerce. Some of the examples of central banks include Bank of Canada, Banco Central do Brasil, Reserve Bank of India, Bank of England and Federal Reserve System

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