Money Center Banks

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DEFINITION of 'Money Center Banks'

A money center bank is similar in structure to a common bank, but its borrowing and lending activities are with govenments, large corporations and regular banks. These types of financial institutions do not borrow from or lend to consumers.

INVESTOPEDIA EXPLAINS 'Money Center Banks'

Money center banks are usually located in major economic centers such as London, Hong Kong, Tokyo and New York. With their large balance sheets, these banks are involved in national and international financial systems.

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RELATED FAQS
  1. What does it mean to invest in money center banks?

    Investing in money center banks normally means investing in stock from a bank that does not deal with the individual customer. ... Read Full Answer >>
  2. Why do banks used the Five Cs of Credit?

    Banks use rigorous policies and analyses when determining if and how much money to lend to clients. The methods used by banks ... Read Full Answer >>
  3. How do interest rate changes affect the profitability of the banking sector?

    The banking sector's profitability increases with interest rate hikes. Institutions in the banking sector such as retail ... Read Full Answer >>
  4. What is a standby letter of credit (SLOC)?

    A standby letter of credit, or SLOC, is a financial instrument that provides a guarantee of payment to a beneficiary in the ... Read Full Answer >>
  5. How do commercial banks make money?

    Commercial banks make money by providing loans and earning interest income from those loans. Customer deposits, such as checking ... Read Full Answer >>
  6. Should commercial and investment banks be legally separated?

    Following the financial crisis of 2008-2009, much of the blame was directed at large financial institutions that took on ... Read Full Answer >>
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