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The essential function of a bank is to provide services related to the storing of deposits and the extending of credit. Banks are a subset of the financial services industry.
The term bank is generally understood as an institution that holds a banking license. Banking licenses are granted by financial supervision authorities and provide rights to conduct the most fundamental banking services such as accepting deposits and making loans.
Typically, a bank generates profits from transaction fees on financial services and on the interest it charges for lending.
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