What type of institution is not typically a commercial bank?

What type of institution is not typically a commercial bank?

• A. Investment bank
• B. Credit union
• C. Savings bank
• D. Asset management company

Answer: (D)

An asset management company is a type of financial institution that primarily manages investment portfolios on behalf of clients, focusing on maximizing returns through various investment strategies. Unlike commercial banks, which provide a range of financial services such as accepting deposits, making loans, and facilitating payment transactions, asset management companies do not typically engage in traditional banking activities like accepting deposits from the general public or providing personal loans. In contrast, investment banks, credit unions, and savings banks have functions that align more closely with typical banking services. Investment banks assist with capital raising, mergers, and acquisitions, while credit unions offer financial products and services to their members, maintaining a community focus. Savings banks primarily accept deposits and provide savings accounts and loans, similar to commercial banks. Thus, the distinguishing feature of asset management companies lies in their focus on managing investments rather than participating in conventional banking operations.

An asset management company is a type of financial institution that primarily manages investment portfolios on behalf of clients, focusing on maximizing returns through various investment strategies. Unlike commercial banks, which provide a range of financial services such as accepting deposits, making loans, and facilitating payment transactions, asset management companies do not typically engage in traditional banking activities like accepting deposits from the general public or providing personal loans.

In contrast, investment banks, credit unions, and savings banks have functions that align more closely with typical banking services. Investment banks assist with capital raising, mergers, and acquisitions, while credit unions offer financial products and services to their members, maintaining a community focus. Savings banks primarily accept deposits and provide savings accounts and loans, similar to commercial banks. Thus, the distinguishing feature of asset management companies lies in their focus on managing investments rather than participating in conventional banking operations.