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compensating balance

noun
1.
Also, compensated balance, compensation balance. a balance wheel in a timepiece, designed to compensate for variations in tension in the hair spring caused by changes in temperature.
2.
Banking. a deposit balance that is required to be left on deposit by a company to maintain or guarantee credit.
Origin
1795-1805
1795-1805
Dictionary.com Unabridged
Based on the Random House Dictionary, © Random House, Inc. 2014.
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Examples for compensating balance
  • However, a compensating balance requirement often exists.
  • Such discounts are usually offered as either fee concessions or compensating balance arrangements.
  • It can include a compensating balance or a deposit balance that secures the loan.

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