Countries with Most Commercial Banks

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The transition from an informal system of moneylending to the formal system of banking is a prerequisite for economic development. Commercial banks have thus formed the backbone of a stable economy and sustained economic functioning. A commercial bank is a financial institution that traditionally performs three basic functions: Accepting deposits, advancing loans and enabling customers to make payments. A commercial bank branch is physically separated from the main office but is not organized as a legally separate subsidiary.

What Banks Do?

The depository function of a bank enables customers to make deposits in return of a small administration fee. The banks allure the depositors with interest rates, to make deposits of three types. The current account deposits, ordinarily for business purposes, does not yield interest and can be withdrawn at any point of time. The saving account types of deposits, offered by the banks are primarily for small savers who can withdraw a limited amount, by writing a check. Lastly, the fixed deposits also called certificate of deposits, are the deposits that cannot be withdrawn prior to the maturity date. These render the highest rate of interest to the depositors.

The second function of the bank, is advancing credit; this is the primary process banks make revenue. The difference between the rate of interest charged from the borrowers and the interest rate offered to the depositors, is the way of drawing revenue for the bank. Factors like the financial status, business profile, and the ability to repay the loan are considered before financing out these loans.

The third basic function of a bank is to enable its customers to make payments. The banks act as agents of payments and providers of money transmitting services.

The main clash between the banks motive, is to provide profitability to its shareholders and maintain enough liquidity to meet the customers demand. Through the mechanism of credit creation, the banks act as a main agent in the functioning of a stable economy. In a globally integrated world the ability of a bank to reduce transaction cost by aggregate settlement of payment and easy access to capital allowing business debt, is only being pronounced.

According to the International Monetary fund, Financial Access Survey, European countries like San Marino, Luxembourg, Spain and Italy, have the largest number of commercial bank branches per 100,000 adults. Cross country studies have shown relationship between the financial volume and regional growth. A single banking system and financial integration, points towards the higher number of commercial branches in these nations.

On the other hand, Ukraine, Belarus, South Sudan and Afghanistan have the fewest number of bank branches per 100,000 adults. A significant boost in lending is yet to catch pace in these countries. They face the common concern of low asset quality and balance sheet troubles.

Below lying is a table depicting the number of commercial banks per 100,00 adults.

Country	Commercial Banks per 100,000 adults (2016)		Country	Commercial Banks per 100,000 adults (2016)
San Marino	223.81		Kuwait	14.27
Luxembourg	76.14		Mexico	14.15
Mongolia	70.37		Maldives	14.08
Spain	61.88		India	14.06
Seychelles	52.83		Germany	13.46
Bulgaria	48.39		Lithuania	13.43
Italy	47.65		Argentina	13.37
Montenegro	44.20		Trinidad and Tobago	12.94
Switzerland	42.46		Austria	12.63
St. Kitts and Nevis	41.21		Dominican Republic	12.60
Macao	37.47		Netherlands	12.46
France	37.06		United Arab Emirates	12.42
Uzbekistan	36.14		Thailand	12.38
Malta	35.83		Fiji	11.84
Iceland	35.60		Palestinian	11.83
Cyprus	34.34		Qatar	11.75
Japan	34.10		Malaysia	11.49
Cabo Verde	33.41		Uruguay	11.43
Guatemala	33.35		Suriname	11.24
Croatia	32.86		Nicaragua	11.12
Georgia	32.67		Ecuador	11.03
United States	32.67		Estonia	10.42
Iran	31.23		Pakistan	10.36
Poland	31.03		Angola	10.29
Slovenia	30.65		South Africa	10.18
Russia	30.14		Paraguay	10.13
Serbia	29.72		Nepal	9.58
Portugal	29.61		El Salvador	9.52
Bahamas	29.58		Singapore	8.98
Bosnia and Herzegovina	28.94		Philippines	8.87
Slovakia	28.27		China	8.78
Romania	27.98		Saudi Arabia	8.58
Australia	27.80		Bangladesh	8.44
Antigua and Barbuda	27.45		Guyana	8.43
Moldova	27.22		Kyrgyzstan	8.38
Sao Tome and Principe	25.53		Botswana	8.32
Grenada	25.31		Mauritania	8.31
Macedonia	25.00		Gambia	8.11
Greece	24.68		Peru	7.96
Morocco	24.67		Ghana	7.13
Lebanon	24.09		Belgium	6.69
Denmark	24.04		Norway	6.16
Panama	23.40		Rwanda	6.16
Armenia	23.10		Mali	6.07
Canada	22.99		Swaziland	5.95
Samoa	22.73		Djibouti	5.89
Czech Republic	22.37		Togo	5.58
Costa Rica	21.79		Finland	5.44
Ireland	21.51		Kenya	5.43
Albania	21.51		Nigeria	5.36
Hong Kong	21.43		Zimbabwe	5.26
Tunisia	20.46		Algeria	5.23
Belize	20.42		Cote d’Ivoire	5.09
Brazil	20.40		Jamaica	5.09
Mauritius	20.40		Timor-Leste	5.04
Marshall Islands	20.26		Senegal	4.96
Kosovo	19.97		Zambia	4.68
Aruba	19.84		Mozambique	4.20
Honduras	19.64		Solomon Islands	4.12
Brunei Darussalam	19.43		Iraq	4.08
Israel	18.86		Vietnam	3.87
Turkey	18.14		Benin	3.62
Sweden	17.58		Myanmar	3.41
Indonesia	17.39	Burundi	3.17
Dominica	17.37	Comoros	3.14
Latvia	17.09	Guinea-Bissau	3.11
Barbados	16.50	Laos	3.04
Oman	16.35	Kazakhstan	2.96
South Korea	16.26	Burkina Faso	2.89
Chile	16.19	Uganda	2.77
St. Lucia	16.01	Guinea	2.64
Colombia	15.76	Madagascar	2.20
Bhutan	15.27	Afghanistan	2.14
Jordan	15.08	Niger	1.62
Hungary	14.70	South Sudan	1.45
Namibia	14.70	Chad	1.01
St. Vincent and the Grenadines	14.42	Belarus	0.86
Federated States of Micronesia	14.34	Ukraine	0.50

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