A "commercial bank" is what is commonly referred to as simply a "bank". The term "commercial" is used to distinguish it from an "investment bank", a type of financial services entity which, instead of lending money directly to a business, helps businesses raise money from other firms in the form of bonds or stock.
The primary operations of banks include:
1 Keeping money safe while also allowing withdrawals when needed
2 Issuance of checkbooks so that bills can be paid and other kinds of payments can be delivered by post
3 Provide personal loans, commercial loans, and mortgage loans (typically loans to purchase a home, property or business)
4 Issuance of credit cards and processing of credit card transactions and billing
5 Issuance of debit cards for use as a substitute for checks
6 Allow financial transactions at branches or by using Automatic Teller Machines (ATMs)
7 Provide wire transfers of funds and Electronic fund transfers between banks
8 Facilitation of standing orders and direct debits, so payments for bills can be made automatically
9 Provide overdraft agreements for the temporary advancement of the Bank's own money to meet monthly spending commitments of a customer in their current account.
10 Provide Charge card advances of the Bank's own money for customers wishing to settle credit advances monthly.
11 Provide a check guaranteed by the Bank itself and prepaid by the customer, such as a cashier's check or certified check.
12 Notary service for financial and other documents
Other types of bank services
1 Private banking - Private banks provide banking services exclusively to high net worth individuals. Many financial services firms require a person or family to have a certain minimum net worth to qualify for private banking services.Private banks often provide more personal services, such as wealth management and tax planning, than normal retail banks.
2 Capital market bank - bank that underwrite debt and equity, assist company deals (advisory services, underwriting and advisory fees), and restructure debt into structured finance products.
3 Bank cards - include both credit cards and debit cards. Bank Of America is the largest issuer of bank cards.
4 Credit card machine services and networks - Companies which provide credit card machine and payment networks call themselves "merchant card providers".
Foreign exchange services
Foreign exchange services are provided by many banks around the world. Foreign exchange services include:
1 Currency Exchange - where clients can purchase and sell foreign currency banknotes
2 Wire transfer - where clients can send funds to international banks abroad
3 Foreign Currency Banking - banking transactions are done in foreign currency
1 Asset management - the term usually given to describe companies which run collective investment funds.
2 Hedge fund management - Hedge funds often employ the services of "prime brokerage" divisions at major investment banks to execute their trades.
3 Custody services - the safe-keeping and processing of the world's securities trades and servicing the associated portfolios. Assets under custody in the world are approximately $100 trillion.
1 Insurance brokerage - Insurance brokers shop for insurance (generally corporate property and casualty insurance) on behalf of customers. Recently a number of websites have been created to give consumers basic price comparisons for services such as insurance, causing controversy within the industry.
2 Insurance underwriting - Personal lines insurance underwriters actually underwrite insurance for individuals, a service still offered primarily through agents, insurance brokers, and stock brokers. Underwriters may also offer similar commercial lines of coverage for businesses. Activities include insurance and annuities, life insurance, retirement insurance, health insurance, and property & casualty insurance.
3 Reinsurance - Reinsurance is insurance sold to insurers themselves, to protect them from catastrophic losses.