A correspondent account, or the so-called "correspondent account", is a type of calculus on which all types of operations of one bank are recorded and subsequently displayed in accordance with a correspondent agreement. In other words, this concept implies a bank account opened by a credit institution , which is used to form reserve funds or various transfers made by the aforementioned structure. As a rule, the institutions of the Central Bank of the country and any commercial structures enter into an agreement between themselves, which serves to record the property in their possession.
Varieties
Like any other financial term, cor. account is a concept that has several directions. There are three types of calculus: loro, nostro and vostro. Let us consider each of them in more detail. So, the first type is used to determine the account that is opened by the bank, the acting correspondent, to the institution that is the respondent. In other words, such a box. Sberbank account reflects all operations of any other organization. These records are recorded in the liability of the enterprise. In turn, nostro-core. account is the estimate of the respondent institution that entered into an agreement with the correspondent bank. For greater clarity, we will analyze an example. Two banks (A and B) entered into a correspondent agreement with each other. In the event that institution A needs to transfer a certain amount, he can use his nostro account in Bank B. And vice versa, if there is a need for financial settlements with structure B, then all transactions performed will be reflected in the correspondent loro account of bank A. It’s easier saying, nostro is our account in another bank, and loro is their account in ours. When the first two varieties became as clear as possible, you can move on to the last type of correspondent accounts - Vostro. Its main feature is that it is an agreement concluded between the Central Bank and any foreign institution, the calculations for which are made either in local currency or in monetary notes of a third country. This definition is rather complementary, therefore, it can be found not as often as the first two.
Typology
In addition, one can distinguish another classification, according to which distinguish between correspondent accounts concluded both between the commercial and the Central Bank of the country, and between two commercial institutions. The first type occurs when creating a new bank, when its authorized capital is formed. Upon successful completion of this process, the Central Bank issues a banking license , and after state registration, the existing box. an account can be used as a form of accounting for property and a way of settlement transactions. The second type, in turn, implies the existence of an agreement between two commercial banks, which establishes a certain procedure for the participation of both structures in financial settlements with customers.
Appointment
It should be noted that box. Bank account is most often used for money transfers. The currency may be different, but it will still be assigned to one correspondent account. In addition, as mentioned earlier, banks can operate with the above estimates to account for their property.
Designation
Like many other financial definitions, a correspondent account allows you to encrypt all the necessary information in numerical designations. The Central Bank of Russia accepted that cor. an account is twenty characters, the first three digits of which traditionally indicate first-order calculus (301), and the last three numbers contain information about the three-digit conditional number of the settlement participant. For example, K / S 30101810600000000957.