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| {{Short description|Very large commercial bank playing major role in key financial center}} | |||
| #redirect ] | |||
| {{Banking}} | |||
| A '''money center bank''' (also written '''money-center bank''') is a ] or ] that is a particular kind of high-end ]: located in a major ] such as New York or San Francisco, its lending operations are financed by borrowings from other banks or by issuing bonds.<ref name="laurence"/> Money center banks tend to engage in a number of different or related businesses, such as | |||
| ], ], ], ], ], ], issuing ], and making loans to ]s and to foreign governments.<ref name="laurence"/><ref name="motleyfool"/> | |||
| Money center banks have extremely large ]s, | |||
| and are large enough and embedded enough within ] that they are often considered to be in the "]" category.<ref name="motleyfool">{{cite web | url=https://www.fool.com/terms/m/money-center-banks/ | title=What Are Money-Center Banks? | first=Kristi | last=Waterworth | publisher=The Motley Fool | date=January 12, 2024 | access-date=October 10, 2024}}</ref> | |||
| Being a money center bank does not have a firm definition,<ref name="kiplinger"/> | |||
| and in some cases, observers may disagree on exactly where the boundary is between money center banks and very large ]s.<ref name="laurence"/> | |||
| As a general tendency, money center banks get more of their funds via ]s compared to getting funds from the ]s of consumers.<ref name="kiplinger">{{cite news | url=https://books.google.com/books?id=AAUEAAAAMBAJ&pg=PA23&dq=%22money+center+bank%22+%22definition%22&hl=en&sa=X&ved=2ahUKEwjHsru55KWJAxWZmYkEHS60LZMQ6AF6BAgFEAI#v=onepage&q=%22money%20center%20bank%22%20%22definition%22&f=false | title=Your Questions Answered | magazine=Kiplinger's Personal Finance | date=October 1983 | pages=22–23}}</ref> | |||
| While money center banks can and do accept deposits from consumers and otherwise behave like a ] in certain of their locations,<ref name="motleyfool"/> | |||
| that is not their major source of income.<ref name="laurence"/> | |||
| There is some overlap between the idea of a money center bank and that of a ].<ref name="cfi">{{cite web | url=https://corporatefinanceinstitute.com/resources/economics/money-center-bank/#:~:text=What%20is%20a%20Money%20Center,at%20least%20within%20a%20region | title=Money Center Bank | publisher=Corporate Finance Institute | access-date=October 22, 2024}}</ref> | |||
| The term 'money center bank' seems to have first started gaining appearances in the 1960s<ref>See </ref> and 1970s<ref>See </ref> although the phrase has been found occurring earlier.<!-- https://www.oed.com/dictionary/money-centre-bank_n?tl=true --> | |||
| According to one breakdown, during the 1980s there were as many as eleven money center banks in the United States.<ref name="jm-hhl">{{cite book | title=Asset Pricing | editor2-first=Hsien-hsing | editor2-last=Liao | editor1-first=Jianping | editor1-last=Mei | publisher=World Scientific | location=Singapore | year=2003 | url=https://books.google.com/books?id=WQvVCgAAQBAJ&pg=PA126&dq=%22money+center+bank%22+%22definition%22&hl=en&newbks=1&newbks_redir=0&sa=X&ved=2ahUKEwjHsru55KWJAxWZmYkEHS60LZMQ6AF6BAgKEAI#v=onepage&q=%22money%20center%20bank%22%20%22definition%22&f=false | pages=119–154<!--think--> | chapter=Bank Risk and Real Estate: An Asset Pricing Perspective | author1-first=Jianping | author1-last=Mei | author2-first=Anthony | author2-last=Saunders}} At p. 126/126n.</ref> | |||
| {{As of|2024}}, the prime examples of American money center banks are ] and ].<ref name="laurence"/><ref name="motleyfool"/><ref name="cfi"/> Two others are often included as well, ] and ].<ref name="motleyfool"/><ref name="cfi"/> Some ancestor companies of these were considered, in their time, as money center banks; in the case of JPMorgan Chase, these include ] and ],<ref name="3-biblio">{{cite news | url=http://www.iht.com/articles/1991/07/16/ban_.php | title=Hanover Swaps Stock With Chemical : Banks Join to Form 2d Biggest in U.S. Manufacturers | first=Lawrence | last=Malkin | newspaper=International Herald Tribune | date=July 16, 1991 | archive-url=https://web.archive.org/web/20051025103206/http://www.iht.com/articles/1991/07/16/ban_.php | archive-date=October 25, 2005}}</ref> as well as the denoted ] and ]<ref name="jm-hhl"/> | |||
| Besides their headquarters, money center banks have offices in major financial centers around the world,<ref name="motleyfool"/> such as in London and Hong Kong.<ref name="cfi"/> Money center banks can be foreign-owned, for instance ] has been owned by ] and ] by ].<ref name="laurence">{{cite book | url=https://www.google.com/books/edition/Money_Banking_and_Financial_Markets/KoGoKwOFFOoC?hl=en&gbpv=1&dq=%22money+center+bank%22&pg=PA221&printsec=frontcover | title=Money, Banking, and Financial Markets | |||
| | first=Laurence M. | last=Ball | publisher=Worth Publishers| location=New York | year= 2009 | pages=221, 228, G-4 }}</ref> | |||
| {{Missing information|whether the term mostly used for U.S. banks or is the term used in other countries as well<!-- https://dictionary.cambridge.org/us/dictionary/english/money-centre-bank -->}} | |||
| == See also == | |||
| * ] | |||
| == References == | |||
| {{reflist}} | |||
| == External links == | |||
| * | |||
| * | |||
| ] | |||
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Revision as of 11:51, 26 October 2024
Very large commercial bank playing major role in key financial center
A money center bank (also written money-center bank) is a bank or bank holding company that is a particular kind of high-end commercial bank: located in a major financial center such as New York or San Francisco, its lending operations are financed by borrowings from other banks or by issuing bonds. Money center banks tend to engage in a number of different or related businesses, such as corporate banking, investment banking, foreign exchange services, currency trading, securities trading, derivatives trading, issuing credit cards, and making loans to private equity firms and to foreign governments. Money center banks have extremely large balance sheets, and are large enough and embedded enough within international finance that they are often considered to be in the "too big to fail" category.
Being a money center bank does not have a firm definition, and in some cases, observers may disagree on exactly where the boundary is between money center banks and very large regional banks. As a general tendency, money center banks get more of their funds via money markets compared to getting funds from the deposit accounts of consumers. While money center banks can and do accept deposits from consumers and otherwise behave like a retail bank in certain of their locations, that is not their major source of income. There is some overlap between the idea of a money center bank and that of a universal bank.
The term 'money center bank' seems to have first started gaining appearances in the 1960s and 1970s although the phrase has been found occurring earlier. According to one breakdown, during the 1980s there were as many as eleven money center banks in the United States.
As of 2024, the prime examples of American money center banks are JPMorgan Chase and Citigroup. Two others are often included as well, Bank of America and Wells Fargo. Some ancestor companies of these were considered, in their time, as money center banks; in the case of JPMorgan Chase, these include Manufacturers Hanover Corporation and Chemical Banking Corporation, as well as the denoted Chase Manhattan Bank and J.P. Morgan & Co.
Besides their headquarters, money center banks have offices in major financial centers around the world, such as in London and Hong Kong. Money center banks can be foreign-owned, for instance Bankers Trust has been owned by Deutsche Bank and HSBC Bank USA by HSBC.
 | This article is missing information about whether the term mostly used for U.S. banks or is the term used in other countries as well. Please expand the article to include this information. Further details may exist on the talk page. |
See also
References
- ^ Ball, Laurence M. (2009). Money, Banking, and Financial Markets. New York: Worth Publishers. pp. 221, 228, G-4.
- ^ Waterworth, Kristi (January 12, 2024). "What Are Money-Center Banks?". The Motley Fool. Retrieved October 10, 2024.
- ^ "Your Questions Answered". Kiplinger's Personal Finance. October 1983. pp. 22–23.
- ^ "Money Center Bank". Corporate Finance Institute. Retrieved October 22, 2024.
- See this Google Books search
- See this New York Times search
- ^ Mei, Jianping; Saunders, Anthony (2003). "Bank Risk and Real Estate: An Asset Pricing Perspective". In Mei, Jianping; Liao, Hsien-hsing (eds.). Asset Pricing. Singapore: World Scientific. pp. 119–154. At p. 126/126n.
- Malkin, Lawrence (July 16, 1991). "Hanover Swaps Stock With Chemical : Banks Join to Form 2d Biggest in U.S. Manufacturers". International Herald Tribune. Archived from the original on October 25, 2005.