Library / English Dictionary

    OFFSETTING BALANCE

    Pronunciation (US): Play  (GB): Play

     I. (noun) 

    Sense 1

    Meaning:

    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 bankplay

    Example:

    the compensating balance increases the effective interest rate to the bank since the net amount loaned is reduced but the interest paid is unchanged

    Synonyms:

    compensating balance; offsetting balance

    Classified under:

    Nouns denoting possession and transfer of possession

    Hypernyms ("offsetting balance" is a kind of...):

    balance (the difference between the totals of the credit and debit sides of an account)

    Credits


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