Which among the following work as assets of banks?
Which among the following work as assets of banks?
[A]Deposits made by public
[B]Funds received from RBI under Liquidity Adjustment Facility
[C]Loans advanced to customers
[D]Current & Saving Accounts of Customers
Loans advanced to customers
The key business of the banks is to accept different types of deposits from the public and then lend these funds to the borrowers. This is called Financial intermediation. In terms of the banks, the deposits represent the “liabilities” of the banks while loans advanced and investments made by banks represent their “assets”.