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Simple English definitions for legal terms
respondent bank
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A quick definition of respondent bank:
A respondent bank is a type of bank that holds securities on behalf of beneficial owners and deposits them for safekeeping with another bank or entity that exercises fiduciary powers. It is a financial establishment that deals with the deposit, loan, exchange, or issue of money and the transmission of funds. A bank is a place where people can keep their money safe and also borrow money when they need it. A respondent bank acts as an agent for another bank or engages in an exchange of services with that bank in a geographical area to which the other bank does not have direct access.
A more thorough explanation:
A respondent bank is a financial establishment that exercises fiduciary powers, holds securities on behalf of beneficial owners, and deposits the securities for safekeeping with another bank, association, or other entity exercising fiduciary powers. For example, a mutual fund company may use a respondent bank to hold the securities of its investors.
Another example of a bank is a commercial bank, which is authorized to receive both demand and time deposits, engage in trust services, issue letters of credit, rent time-deposit boxes, and provide similar services. A national bank is a bank incorporated under federal law and governed by a charter approved by the Comptroller of the Currency. A savings bank makes primarily home mortgage and some other consumer loans, receives deposits and pays interest on them, and may offer checking accounts.
Overall, a bank is a financial institution that provides various services related to money, such as depositing, loaning, exchanging, or issuing money, and transmitting funds. Banks are regulated by state or federal banking authorities and are supervised and examined to ensure their compliance with the law.