A channel bank is a device used for multiplexing or demultiplexing a group of communication channels, including analog or digital telephone lines combined as a channel of higher bandwidth or digital bit rate. Channel banks are located in a telephone exchange or enterprise telephone closet, where individual telephone lines are separated from high-capacity telephone trunk lines originating from a central telephone office or enterprise private branch exchange (PBX).
Techopedia explains Channel Bank
Channel banks connect multiple voice channels through multiplexing and voice digitalization and are important digital communication transmission devices.
A channel bank is referred to as a bank because of its processing power that converts a bank of up to 24 or 32 individual channels to a digital and then analog format. These channels contain T1/E1 circuits. A channel bank may also multiplex channel groups into higher bandwidth analog channels.
There are different types of channel banks. Every channel bank contains formatting, which allows a user to achieve the desired results. Channel banks types include T1 circuits, each composed of 24 channels, and D4 channel banks containing digital signal level one (DS-1) signals. The DS-1 ensures that data is formatted with D4 format. Other types of channel banks are D2, D3, and digital carrier trunk. These channels are widely used by most telephone companies.