Compensating balances refer to charges that compensate the bank for work it does to balance customer accounts.

Name: Compensating balances refer to charges that compensate the bank for work it does to balance customer accounts.
Brand: Quizplus
Rating: 4.9 (47 reviews)

Question

Quizplus · Accepted Answer

Compensating balances refer to minimum balances that must be maintained in bank accounts in order to receive certain benefits, such as loan eligibility or reduced fees. It is not a charge for balancing customer accounts.

Compensating Balances Refer to Charges That Compensate the Bank for Work