What Are Balance Sheet Reserves?

The balance sheet of a commercial bank is a financial statement used by a commercial bank to reflect the bank's total assets, liabilities and owner's equity at the end of the accounting period. It is divided into two parts: basic part and supplementary information. The basic part is divided into left and right sides. The left side lists asset items and the right side lists liabilities and owner's equity items. Each item has two columns, "Beginning of Year" and "End of Period". From the perspective of the owner, all the assets of the bank belong to either the creditor or the investor, so the totals of the left and right sides of the balance sheet are always equal and balanced. ^[1]

Commercial bank balance sheet

1. Cash assets.
Cash assets include cash on hand, gold and silver inventories, interbank deposits, statutory deposit reserves and reserve funds with the central bank, and other forms of cash assets. The statutory deposit reserve required by the central bank is a deposit made to the central bank in accordance with the requirements of the deposit reserve system and the determined deposit range and deposit ratio to ensure the payment capacity of commercial banks. Interbank deposits are various types of money deposited between other banking institutions to meet the needs of daily settlement transactions.
2. short-term loan.
Short-term loans refer to various loans issued by commercial banks with a term of less than one year, including various short-term loans and short-term trust loans. The characteristics of short-term loans are: strong liquidity, low risk, easy supervision and management, and easy operation. In order to ensure the liquidity of credit funds, banks must maintain certain short-term loans.
3 Demolition of peers.
In order to flexibly dispatch funds and improve the efficiency of capital utilization, capital borrowing business often occurs between commercial banks to adjust the capital position, which is essentially a short-term loan provided by the capital borrowing bank to the capital borrowing bank.
4 Import and export receivables.
Import and export receivables receivables refer to receivables receivables arising from commercial banks' import and export receivables business. These include the advances made on behalf of the importing unit with the negotiable order from the foreign negotiating bank as the mortgage after the issuance of the letter of credit, and the negotiable amount of the export documents under the letter of credit from the commercial bank to the exporting unit. This article comes from timely information 5. Accounts receivable and bad debt provision.
Commercial banks' receivables include various receivables arising from business operations, as well as interest receivables, receivable handling fees, and securities receivables. Among them, interest receivables include loan receivables, interest receivables, and so on. Provision for bad debts is an irrecoverable amount of accounts receivable that is estimated in advance in accounting. According to the requirements of accrual basis, a commercial bank can withdraw provisions for offsetting losses caused by bad debts to correctly reflect its assets and income.
6. Other receivables.
Refers to the receivables and temporary payments made by commercial banks to other units and individuals. It mainly includes various deposits deposited by commercial banks for handling business, temporary receivables and receivables, and temporary advances that occur during the course of handling business.
7. Bill financing.
Refers to discounts, re-discounts, rediscounts,

1. Short-term deposits.
Refers to commercial banks accepting deposits of less than one year from enterprises and institutions.
2. Short-term savings deposits.
Refers to commercial banks accepting various savings deposits of less than one year for resident individuals.
3 Interbank deposits.
It refers to the amount of money deposited with the bank by a bank due to the exchange of funds between a commercial bank and other commercial banks.
4 Bank of Deposits.
Refers to the funds deposited with the Bank by the interbank funds between commercial banks.
5. Remittance should be resolved.
Refers to the amount of money to be paid received by banks engaged in remittance business and temporary deposits of foreign purchasing units or individuals.
6. Outward remittance.
Refers to the bank's remittances accepted by enterprises or institutions or individuals.
7. Amount due to agency securities.
Refers to the bank's issuance, redemption, purchase and sale of securities business on behalf of customers, and payments due to customers who pay. It includes the issuance of securities by agents, the compensation of securities, and the purchase of securities.

8. Central bank borrowing.
Refers to the annual, seasonal and day-to-day borrowings that commercial banks apply to the Central Bank for borrowing.
9. Interbank demolition.
Refers to a type of short-term loan between commercial banks that uses the time difference, space difference, and inter-bank difference in the process of asset finance to adjust the capital position.
10 Long-term deposits.
It reflects that commercial banks accept deposits of over 1 year from other financial institutions and units.
11. Long-term savings deposits.
It reflects that commercial banks accept savings deposits of more than one year from resident individuals.
This article comes from: Accounting Yayuan