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What does a bank do to guarantee that it can pay back depositors' money?
Wiki User
∙ 13y ago
bankrupt
Wiki User
∙ 13y ago
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The money a bank pays depositors for the right to use their money is called?
Interest.
Many depositors withdrawing money at once?
bank run
People who have money in the bank are called?
they are called depositors because they deposit their money in the bank. they are also called bank clients.
What is a run on the bank?
It can happen that the depositors lose confidence in a banks ability to look after their money. if this happens in a big way most of the depositors demand the money they have in their accounts. this is known as a run on the bank. No bank can withstan a run on it without outside assistance.
Why do banks charge borrowers a higher rate of interest than they pay their depositors?
First a bank is not a nonprofit business. The difference in the interests rates is how they make their money and cover the cost of loans that default. By lending someone money the bank is risking that the money wont be paid back. That risk is theirs to carry if they charged the same interest to the borrowers as the depositors there would be no money cushion to cover the loss of a bad loan and it would be unfair for the depositors to loose their money because the bank made a bad loan.
People who have money in a bank are called?
depositors
People who have money in a bank are called what?
depositors
What are people that have money in the bank called?
Depositors.............Politicians :-)
How does icici bank receive money from depositors?
Poda patty
Many depositors withdrawing money at once?
bank run
The money a bank pays depositors for the right to use their money is called?
Interest.
People who have money in the bank are called?
they are called depositors because they deposit their money in the bank. they are also called bank clients.
What is a run on the bank?
It can happen that the depositors lose confidence in a banks ability to look after their money. if this happens in a big way most of the depositors demand the money they have in their accounts. this is known as a run on the bank. No bank can withstan a run on it without outside assistance.
Why do banks charge borrowers a higher rate of interest than they pay their depositors?
First a bank is not a nonprofit business. The difference in the interests rates is how they make their money and cover the cost of loans that default. By lending someone money the bank is risking that the money wont be paid back. That risk is theirs to carry if they charged the same interest to the borrowers as the depositors there would be no money cushion to cover the loss of a bad loan and it would be unfair for the depositors to loose their money because the bank made a bad loan.
When depositors all want their money at the same time?
It is called a "Bank Run"
What is a run on a bank?
A "run" is when panic sets in due to depositors' fear they will not be able to get their money back from the bank. So many depositors ask for their funds immediately that the bank runs out of cash to give them. This, of course, only makes things worse as the cycle of fear and withdrawals spins downward until the bank is forced to shut its doors.
Why bank is called financial intermediateries?
Bank is financial service provider.Ist time i will say who r deposited in bank? the answer is who has surplus of money.that unit is called SFU( surplus economic unit) and bank is kept that money ,when depositors money is more in bank,then after bank gives the loan deficts who has able to return of that money in the bank with interest.but suddendly if the depositors want to his or her money for need to bank,then bank gives the money with cutting the certain fixed interest rate.
