Legal Definitions - bank

A bank is a financial institution that is licensed to receive deposits, make loans, exchange currency, issue money, transmit funds, and exercise fiduciary powers. It is a quasi public institution that is incorporated and engaged in the business of financial transactions under the laws of the United States or any state.

There are different types of banks, including:

• Retail banks: These are banks that provide services to individuals and small businesses, such as checking and savings accounts, loans, and credit cards.
• Commercial or corporate banks: These are banks that provide services to large businesses and corporations, such as loans, lines of credit, and treasury management services.
• Investment banks: These are banks that provide services related to securities and investments, such as underwriting, trading, and mergers and acquisitions.

A bank is considered a "creature of statute" and operates by legislative grace. This means that the right to carry on a banking business through the agency of a corporation is a "franchise" that is dependent on a grant of corporate powers by the state.

For example, if you deposit money into a checking account at a retail bank, the bank will hold your money and allow you to withdraw it as needed. The bank may also charge you fees for certain services, such as overdraft protection or ATM usage. If you take out a loan from a commercial bank, the bank will provide you with the funds you need and charge you interest on the amount borrowed. Investment banks may help companies raise capital by underwriting securities offerings or advising on mergers and acquisitions.