Banks and Banking

Over the past decades, the banking industry has experienced a major worldwide restructuring. This movement has reshaped regional economies and urban spaces across the United States. Banks today offer a wider range of products and services than in the past, and deliver them faster and more efficiently. However, the bank's central purpose remains what it has always been, putting the community's surplus resources (deposits and investments) to work by lending the resources to citizens and companies.

If there were one industry with the stigma of being old and stodgy, it would have to be banking; however, the global trend of deregulation has created new business possibilities in banking. Deregulation, coupled with technological developments such as online banking and ATMs, is giving the banking industry an opportunity to shed its lackluster image.

Banks have begun to use assetbuilding plans to stimulate assetbased development in areas of the United States such as lowincome and minority urban spaces. These plans have focused on creating more real estate development and removing urban “blight” (real estate based asset building). Banks' efforts have also encouraged communitybased financial and business enterprises.

There are two main types of banks in the United States: regional (and thrift) banks and major (mega) banks. The first type includes smaller financial institutions that primarily focus on one geographical area. In the U.S., there are six such geographical areas: the Northeast, Southeast, Central or Midwest, Northwest, Southwest, and Far West. Providing depository and lending services is the regional banks' primary line of business. The second type of bank includes banks that operate local or regional branches but whose main line of business is in financial centers; an example is New York City, where banks get involved with international transactions, underwriting, and so on.

The United States government is very involved in the banking industry, as it sets restrictions on borrowing limits and the amount of deposits that banks must hold in their vault. Also, the Federal Reserve Bank has a major influence on the bank's profitability, as it sets the interest rates which influence the credit market (loans).