Question

Write about any three general utility functions of Commercial Bank.

Give two general utility functions of commercial banks.

Answer 1

1. Issuing credit instruments: Customers receive letters of credit, drafts, and travellers' checks from banks. People can transfer money from one location to another without having to carry cash.
2. Underwriting capital issues: Companies' shares and debentures are underwritten by banks.
3. Valuables are kept safe: For safekeeping, banks accept jewellery, documents, and other valuables. They have safe deposit vaults where these items can be kept.