In the banks hierarchy, which is a subdivision of Commercial Banks?

• A. Retail banks
• B. Investment Banks
• C. Wholesale banks
• D. All of the above

Answer: (A)

Retail banking is the part of a bank that serves individual customers and small businesses with everyday services like deposits, payments, mortgages, and personal loans. This is the subdivision that clearly sits under the umbrella of commercial banks, which handle the core banking activities of taking deposits and lending to the public.

Investment banks focus on capital markets activities for large corporations and governments, often operating separately from commercial banks (or only as a division in universal banks), so they’re not considered a standard subdivision of commercial banks. Wholesale banking, while it serves large corporate clients and institutions, is typically described as a function within commercial banking rather than a separate subdivision in many banking hierarchies. Because retail banking directly represents the mass-market branch of commercial banking, it’s the best fit for the subdivision in this context.