Q. Which of the following is not included in the assets of a commercial bank in India?

  • Advances
  • Deposits
  • Investments
  • Money at call and short notice

Answer: (b) Deposits

Notes:
  • Deposits are not included in the assets of a commercial bank in India. Deposits are liabilities of the bank, as they represent the funds that the bank owes to its customers.
  • The key business of the banks is to accept different types of deposits from the public and then lend these funds to the borrowers. This is called Financial intermediation.
  • In terms of the banks, the deposits represent the “liabilities” of the banks while loans advanced and investments made by banks represent their “assets”.
    • The deposit itself is a liability owed by the bank to the depositor.
assets and liabilities of bank