Universal Bank

Rather than specialising, a universal bank serves almost every type of customer and need. It may provide current accounts and mortgages to individuals, loans and payments to businesses, advice on mergers and share issues to large companies, trading in financial markets and investment management for wealthy clients.

Many of the largest banks in Europe and elsewhere operate as universal banks.

Supporters argue that the model brings benefits: customers can access many services from one institution, the bank can spread risks across different businesses and it can cross-sell products. For example, a business customer with a commercial loan may also use the bank's investment banking division when it later goes public.

Critics argue that combining risky trading and investment banking with ordinary deposit-taking can put depositors and taxpayers at risk if the riskier activities suffer heavy losses. After the 2008 financial crisis, some countries introduced rules requiring large banks to separate or ring-fence their retail operations from investment banking activities.