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Off balance sheet items are those items in the books of bank, which are not mentioned in the the balance sheet of the bank.
these items are not assets nor liabilities to be reported in the balance sheet as on the date of balance sheet, but may get converted into asset or liability at a later date, depending on the happening of a certain event.
these items are contingent upon certain breach of commitments are also called contingent liabilities . these contingent liabilities have to be disclosed as notes to the balance sheet.these items includes.

1. direct credit substitutes
2.certain transaction related contingent items
3.short term self liquidating trade related contingencies and repurchase agreement and asset sales with recourse
5.forward asset purchases , forward deposit
6.note issuance facilities and revolving underwriting facilities
7.aggregate outstanding foreign exchange contracts

most important

banks classify their off balance sheet into three broad categories
1. full risk -(credit substitute)-stand by letters of credit , money guarantee etc
2. medium risk (not direct credit substitute , which do not support existing financial obligation )-bid bonds, letters of credit, indemnities and warranties
3. low risk -revers repos, currency swaps,option, future etc
gr8 satvir bhai sara main point post kar diya
gr8 satvir_sbi
good satvir paa ji

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