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compensating balance

Synonyms of compensating balance Antonyms of compensating balance Examples of compensating balance Usage of compensating balance Parts of compensating balance Definition that contains compensating balance Words sounding like compensating balance Explanation of compensating balance

noun
a minimum credit balance that a bank may require a borrower to keep on deposit as a condition for granting a loan; a common requirement for establishing a line of credit at a bank
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"the compensating balance increases the effective interest rate to the bank since the net amount loaned is reduced but the interest paid is unchanged"

Similar:

offsetting balance

type of:
balance

Explanation of compensating balance

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