A commercial bank takes deposits and makes loans. That is the core. It pays interest on savings and charges interest on loans. The difference, called the spread, is how it makes money. Commercial banks serve individuals, businesses, and governments.

They are different from investment banks, which help companies raise capital and trade securities. Commercial banks are the ones with branches, ATMs, and checking accounts. They are regulated heavily because they hold the public's money and because failures can cascade through the economy. Deposit insurance, like the FDIC in the US, protects savers up to a limit.

Banking has changed. Online banks operate without branches. Fintech companies offer payment and lending services. Traditional banks have responded with apps and digital tools. But the basic model — take deposits, make loans, manage risk — remains. When it breaks, as in 2008, the consequences are severe.

Main services

• Checking and savings accounts
• Personal and business loans
• Mortgages
• Credit cards
• Certificates of deposit