Banking Law

The English term 'Bank' has been derived from the latin word 'Bancus' or the
french word 'Banque'. The other view is that the term bank was derived from
the German word 'Banck' which means joint stock or common fund raised
from a large number of members of the public.

SECTION 5 of the Banking Regulation Act 1949

By virtue of Section 5, a bank is an instituition-

1. Which accepts deposits from the public on current, fixed and savings
bank account.

2. Which allows withdrawals of those deposits by cheques, drafts, order

etc.

3. Which utilises the deposits in hand for the purpose of lending or

investment securities.

4. That performs other activities called subsidiary services,in addition to

the principal activities of receiving of deposits and lending of funds

5. That performs banking as main business and uses the term bank, banker
or banking company as part of its name.

Essentials Characteristics of a Bank

1. A banking instituition should accept deposits of money from the public