Commercial Bank
A financial institution that accepts deposits and makes loans to individuals and businesses.
What is Commercial Bank?
A commercial bank is a financial institution that accepts deposits from the public and makes loans to individuals, businesses, and governments. Commercial banks are the primary providers of checking and savings accounts, mortgages, credit cards, auto loans, and business credit lines. They are regulated by federal and state banking regulators — primarily the OCC, FDIC, and Federal Reserve — and deposits are insured by the FDIC up to $250,000. Commercial banks profit from the spread between the interest rate they pay depositors and the rate they charge borrowers.
Example
JPMorgan Chase, with over $3.9 trillion in assets as of 2024, is the largest US commercial bank. It accepts trillions in deposits paying 0.01–5% APY and lends those same funds at 6–10% interest rates, capturing the spread as profit.
Source: FDIC — Bank Data & Statistics