Dealer Bank


DEFINITION of 'Dealer Bank'

A commercial bank authorized to buy and sell government debt securities including federal and municipal bonds. This debt is usually issued to fund large government projects such as road and bridge construction. Dealer banks are registered with the Municipal Securities Rulemaking Board.


Income from municipal bonds is usually exempt from federal income taxes in addition to being virtually risk-free with a near zero default rate.

  1. Commercial Bank

    A financial institution that provides services, such as accepting ...
  2. Debt Security

    Any debt instrument that can be bought or sold between two parties ...
  3. Default Risk

    The event in which companies or individuals will be unable to ...
  4. Bankruptcy

    A legal proceeding involving a person or business that is unable ...
  5. Municipal Bond

    A debt security issued by a state, municipality or county to ...
  6. Treasury Bill - T-Bill

    A short-term debt obligation backed by the U.S. government with ...
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  1. Where can I buy government bonds?

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    Most of the time, when an investor or analyst searches through the financial statements of a publicly traded company, he ... Read Full Answer >>
  3. Are long-term U.S. government bonds risk-free?

    For any debt obligation to be considered completely risk-free, investors must have full faith that the principal and interest ... Read Full Answer >>
  4. Do mutual funds invest only in stocks?

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    The general relationship between current yield and risk is that they increase in correlation to one another. A higher current ... Read Full Answer >>
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