Which is not an asset of Commercial Bank of India?

Which is not an asset of Commercial Bank of India?

UPSC Question. Deposit is not an asset of a commercial bank, it is a liability of the bank since it has to returned the deposit of customers when demanded in case of saving or current account or on the maturity of the date in case of fixed deposit.

Are deposits considered bank assets?

The deposit itself is a liability owed by the bank to the depositor. When someone opens a bank account and makes a cash deposit, he surrenders the legal title to the cash, and it becomes an asset of the bank.

Does a Commercial Bank accept deposits?

Commercial banks are what most people think of when they hear the term “bank.” Commercial banks accept deposits, make loans, safeguard assets, and work with many different types of clients, including the general public and businesses.

Why are deposits considered as liabilities of commercial banks?

When bank customers deposit money into a checking account, savings account, or a certificate of deposit, the bank views these deposits as liabilities. After all, the bank owes these deposits to its customers, and are obligated to return the funds when the customers wish to withdraw their money.

What are the assets of a commercial bank?

Financial Assets of a Commercial Bank

• Liquidity and Profitability:
• Cash-in-Hand:
• Cash at the Central Bank:
• Money at Call and Short Notice:
• Bills Discounted:
• Government Securities with One Year or Less to Maturity:
• Certificates of Deposit:
• Investments:

Which of the following is an asset for a commercial bank?

This includes property, goods, savings or investments. These are things that people own such as buildings, vehicles, shares and money in the bank. The opposite is liabilities. For a bank, its assets are mainly the loans gives to its customers.

What are the assets of commercial bank in India?

What is commercial bank assets?

The bank’s assets include cash; investments or securities; loans and advances made to customers of all kinds, though primarily to corporations (including term loans and mortgages); and, finally, the bank’s premises, furniture, and fittings.

Why are commercial banks not allowed to buy stock with your deposits?

Risk. Federal banking regulations limit how much banks can invest in stock, how much cash they must keep on hand to cover customer withdrawals, and even how much risk they can take on with their investments. As a result, banks usually avoid stocks that are high-risk or highly volatile.

Why are deposits in banks called deposits?

Apart from money being safely kept in the banks, people are also paid interest on the amount of money deposited in their bank account. Deposits also act as direct money in case of cheque payments. Cheques against a deposit settle payments without the use of direct cash.

What current assets do not include?

Fixed Asset: These are tangible or long-term assets that include buildings, land, fixtures, equipment, vehicles, machinery, and furniture. Therefore, the term “current asset” does not include Furniture.