What has thus far been said about banking deals chiefly with relations between the bank and the individual or between the bank and the public. It must be remembered, however, that in most countries there are many banks. In some, where branch banking is followed, these banks are not independent of one another in the sense of having a different corporate existence, but they are different offices of the same institution. In others, however, they are separately organized and are in other respects independent banks. In the United States we have about 30,000 independently organized banks, each with its own charter. Of these banks about 8,000 have been chartered by the federal government, while others have been chartered by the state governments. In foreign countries the number of independent banks is usually very much smaller, but these banks are authorized to establish branches. Thus in Canada at the present time, for example, the number of banks is 17, but the various banks are authorized to establish branch offices. It is probable that in Canada there is an even larger number of bank offices open to the public than in the United States in proportion to population, the total number of branches there being 4,676. Exactly how many independent banks or branch-bank offices there should be in a country depends upon circumstances. There is no definite rule in the matter. Conditions of transportation and volume of business available in various communities determine the number of offices thus to be established.

Whether the banks are independently organized or are simply different offices of the same general organization, it still remains true that they must have various relationships with one another. Not all persons do business with the same bank, and consequently every bank obtains claims upon other banks or has to pay claims held by others. Thus it becomes essential to develop a definite system of dealings between banks. These dealings may be classified in a general way as collection and remittance, deposit, and rediscount. There are other functions which are performed by banks for other banks, but they are of the same general description that may be performed by any business house for another. Those that have just been mentioned are distinctly banking functions, and as such they require a particular kind of banking organization in order that they may be successfully carried on.