compensating balance, n.
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
<noun.possession>
compensating balance offsetting balance
<noun.possession>
compensating balance offsetting balance
sample sentences
"the compensating balance increases the effective interest rate to the bank since the net amount loaned is reduced but the interest paid is unchanged"
semantic pointers
hypernym