What type of banking structure allows both commercial and investment banking in Germany?

The type of banking structure that allows both commercial and investment banking in Germany is universal banking. This system enables banks to engage in a broad range of financial services, including traditional banking functions such as accepting deposits and making loans, as well as investment banking activities like underwriting securities, facilitating mergers and acquisitions, and managing investment portfolios.

Universal banks play a significant role in the German financial system, providing clients with a comprehensive suite of services under one roof. This approach allows for greater efficiency and convenience for businesses and individuals who require various financial services.

In contrast, investment banking specifically focuses on capital raising and advisory services and does not typically include commercial banking activities. Merchant banking involves similar investment activities but often emphasizes private equity and long-term funding rather than the broader spectrum of services offered by universal banks. Cooperative banking focuses on serving specific member interests and may not incorporate both commercial and investment banking functions comprehensively.