Corporate banking is a term used for financing and other banking services, specifically catering to the needs of corporations and large firms.
On the other hand, the term corporate finance refers to one of the areas of finance which involves decisionmaking and strategizing for companies. It aims to minimize the financial risks that a company could potentially face, while also raising the company’s value.
Companies have to make both long and short-term financial decisions. Regular cash management and inventories fall under short-term decisions. On the other hand, an example of a long-term decision is that made on capital investment. This involves making judgement calls on which ventures to invest in. It also includes decisions on how the investments will be made and details on investor payouts.
Investment banking is often associated with corporate finance. The main role of investment banks is capital management, depending on a company’s financial requirements.
Another term for banking that handles the accounts of businesses or corporations is commercial banking. This is taken in contrast to retail banking, which involves the delivery of financial services to individuals. Many banks offer both commercial and retail services.
The commercial banking aspect involves the issue of bank drafts, letters of credit, and guarantees. Commercial banks also deliver cash management services and issue loans. They handle the processing of payments made through various channels, from bank transfers to Internet transactions. They may also sell a variety of financial trusts and products.