Question

State whether the following statement is True or False:
Central bank also performs commercial banking business.

• A. True
• B. False

Answer 1

The correct option is B False

Central bank is an apex bank that controls the entire banking system of a country. It is the sole agency of note issuing and controls the supply of money in the economy. It serves as the banker of the government and manages foreign exchange of the government where as commercial banks only deals in accepting and lending of money of the general public. Therefore, it does not performs any banking activities of commercial banks.