Identify the balance sheet components of a commercial bankSo

Identify the balance sheet components of a commercial bank.

Solution

The balance sheet of a commercial bank typically has two sections . One is liabilities and another is assets . Liabilities refer to the depositis with the banks on which they have to pay interest . While assets are loans or advances made by the banks from which there is a prospect of earning for the bank .

Liabilities include : Share Capital , reserve , deposits ( fixed , savings etc ) , borrowings etc .

Assets include : bills and securities discounted , cash in hand , cash with central bank , investments , loans and advances etc .