Question

Unit Banks are linked with bigger banks by a system called

• A. Correspondent banking
• B. Mutual banking
• C. Retail banking
• D. Chain banking

Answer 1

Answer:

A. Correspondent banking

Unit Banking or Localised Banking:

• A commercial bank that works with a single office is called Unit Banking.
• These types of banks do not maintain any other branches.
• It is also known as Localised Banking.
• Unit banking is well developed in USA because different States have different legislation.
• The main reason for the development of Unit banking in America is said to be fear of Monopoly in banking.
•  A bank which operates in a limited area with one independent office is called Unit Banking.
• Unit Banks are linked with bigger banks by a system called Correspondent banking.