Question 33
Financial InstitutionsWhich of the following is a liability of a commercial bank?
- A.Deposits in the bank
- B.Loans made by the bank to individuals
- C.Loans made by the bank to other banks
- D.Bonds purchased by the bank
Show the answer and explanation
Answer: A (Deposits in the bank)
Explanation
Deposits belong to customers and the bank must repay them on demand, so they are liabilities; loans and bonds are assets.