US Banks

US banks, like any other civilized state, play an important role in the development of the economy. They lend to businesses, contributing to the growth of production, as well as the population by increasing consumer consumption, and are considered arteries of the financial system. Despite the classical banking system in Europe, where there are central banks and a system of commercial banking institutions, the current US banking solutions are fundamentally different from this approach.

The Modern System of US Banks

  • Nowadays the US banking solutions are based on the activities of banking and financial holdings, commercial and investment banks.
  • US commercial banks are classified:
  • By the level of presence in the United States:
  • federal (national);
  • regular.
  • By branching (distribution):
  • branchless, without branches;
  • branch offices with a network of branches.

Federal banks are members of the Fed. The rating of the largest US banks includes JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, The Bank of New York Mellon, US Bancorp, HSBC Bank USA, PNC Financial Services, and others with total assets of less than 300 billion US dollars.

Another group of US banks is investment banks. This group appeared after the tightening of legislation in the field of banking during the Great Depression when banks were prohibited from combining lending and depositing activities and carrying out investment operations with securities.

Investment banks carry out investment and trust operations with securities. They can both redeem corporate bonds and manage and store clients' bonds in their accounts.

In the end, it should be noted that today the US banking solutions have the right to create banking and financial conglomerates (holdings), which allows them to engage in both commercial and investment activities. In this regard, the division into commercial and investment banks is already outdated. Especially after the adoption of the 1999 Law on Financial Modernization. Examples of such holdings are JPMorgan Chase, Bank of America, Citigroup Inc., and others.