Archives: Terms

Definition of Balanced Investment Strategy A balanced investment strategy is an approach to investing that seeks to achieve a balance between risk and return. That means it is a strategy that seeks to diversify investments across different asset classes in order to reduce risk while still achieving a reasonable return. […]

Definition of Bank A bank is a financial institution that provides banking services such as accepting deposits, making loans, and providing other financial services. Banks are typically regulated by the government and are subject to various laws and regulations. Examples Let’s look at a typical bank. It has a physical […]

Definition of Bank Capital Bank capital is the amount of money that a bank has to set aside to cover potential losses. That means it is the difference between a bank’s total assets and its total liabilities. It is also known as regulatory capital or Tier 1 capital. Example To […]

Definition of Bank Credit Bank credit is a type of loan that is provided by a bank to a borrower. That means it is a form of debt that is used to finance investments or purchases. Bank credit is usually provided in the form of a line of credit, which […]

Definition of Bank Deposits Bank deposits are funds that are placed in a bank account. That means they are funds that are held by a bank on behalf of a customer. Bank deposits are usually held in the form of cash, but they can also be held in the form […]

Definition of Bank Rating A bank rating is an assessment of a bank’s financial strength and creditworthiness. That means it is a measure of the bank’s ability to meet its financial obligations and repay its debts. Bank ratings are usually provided by independent rating agencies such as Moody’s, Standard & […]

Definition of Bank Reserve Bank reserves are funds that banks are required to hold in reserve in order to meet their obligations to their customers. That means they are funds that banks must keep on hand in order to meet their customers’ withdrawal requests and other obligations. Bank reserves are […]

Definition of Bank Stress Test A bank stress test is a simulation of a bank’s financial performance under various economic scenarios. That means it is a tool used by regulators to assess the resilience of a bank’s balance sheet and its ability to withstand potential losses. The purpose of the […]