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When a bank combines the deposit as well as investment banking activites, it is called mixed banking. In other words, when banks perform the dual function of commercial banking and investment banking, i.e., provide long term lending to industries. it is called mixed banking.

It all stared in Germany. After indutrial development took place. there were no banks in Germany to provide long term finance to these industrial units. So the commercial banks in Germany were forced to finance to these industries both for short-term as well as for long-term requirements. These banks, were therefore, called mixed banking. That is they were doing the functiion of a commercial banks as well as investment banks.

M.J.SUBRAMANYAM, BANGALORE, India

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Q: What is mixed banking?
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