Classification of bank on the basis of non-banking financial institutions

There are various kinds of non-bank financial institutions operating in Bangladesh. The leading of those banks are as follows-
1. Merchant banking companies: Merchant banking companies help business house or the government corporation in raising capital from the open market through share capital, debenture, and long-term deposits. They act as middlemen between businessman and the investors. They underwrite issue of share and provide consultancy services to the clients. In Bangladesh, separate merchant banking companies are yet to seen. These jobs are partly done by some of the commercial banks. Some leasing companies also do merchant banking.

Classification of bank on the basis of origin

On the basis of birth or origin or registration, banks may be classified as follows-

1. Local banks: Local banks are those banks which are incorporated and registered in Bangladesh. All other commercial banks operating in Bangladesh except the foreign banks are local banks.

Classification of bank on the basis of ownership

On the basis of ownership, the banks in our country may be classified as follows-
1. Fully government owned or nationalized banks- Sonali bank, Janata bank
2. Denationalized banks- Rupali bank
3. Banks in the private sectors- Prime bank, Standard bank, City bank etc
4. Joint venture banks- Dutch Bangla bank ltd, IFIC bank ltd

Brief discussion of banks Classification on the basis of function

1. Central banks: A central bank functions as a top controlling bank for all other banks of the country. It functions as controller of credit, bankers’ bank and enjoys the monopoly of issuing currency notes on behalf of the government. In our country Bangladesh bank enjoys these privileges.
2. Commercial banks: A commercial bank is essentially meant for providing short-term credit to trade and industry. In our country the role of commercial banks has undergone a revolutionary change. They are now providing credit in an increasing measure to agriculture, small scale industries and other weaker sections of the economy like small business, retail trade etc. There are about fifty commercial banks at the moment in Bangladesh.