Capacitor banks are used to prop up voltage on weak systems (where weak is relative to load). Adding shunt capacitors causes the voltage to go up, just like adding shunt inductors pulls the voltage down.
Its a number of usually large valued capacitors placed in parallel to increase the capacitance even further. Usually there are large buss bar conductors used for the interconnect.
The purpose is store a lot of energy and to deliver high pulse current on demand.
The capacitor reactance is generally applied to the system by using static capacitor in shut or series with system. Instead of using a single unit of capacitor per phase of the system, it is quite effective to use a bank of capacitor units, in the view of maintenance and erection. This group or bank of capacitor units is known as capacitor bank.
Theoretically it is always desired to commission a capacitor bank nearer to reactive load. This makes transmission of reactive KVARS is removed from a greater part of the network.