DEFINITION of 'Associate Bank'

A bank that is affiliated, usually through membership, in a regional or national organization, such as a clearing house, an electronic payments network or a bank card network, such as Visa or MasterCard. There are usually different classes of membership in regional and national associations, which correlate with shares owned or fees paid.

BREAKING DOWN 'Associate Bank'

The term "associate bank" is also used to describe banks that accommodate each other's customers across geographic or national lines when each bank's geographic reach is limited. For example, a small state bank in the United States may have an associate relationship with a bank in London, in order to accommodate a customer traveling there.

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