Bad Debt Reserve
Definition of 'Bad Debt Reserve'An account set aside by a company to account for and offset losses that arise as a result of defaults from futures loans. This figure may be calculated based on historical norms or other known information about the relative safety of the debt.Also known as a "loss reserve". |
|
Investopedia explains 'Bad Debt Reserve'Bad debt reserves become alarming when they reach levels outside of historical norms or averages, either at the company level or the national level. For instance, there are many concerns today about China's high bad debt reserves at its banks, an aftereffect of many years of almost non-existent lending requirements. |
Related Definitions
Articles Of Interest
-
The Importance Of Your Credit Rating
A great starting point for learning what a credit score is, how it is calculated and why it is so important. -
What Is A Corporate Credit Rating?
Is the bond you're buying investment grade, or just junk? Find out how check the score. -
Debt Reckoning
Learn about debt ratios and how to use them to assess a company's financial health. You could save a lot of money! -
6 Asset Allocation Strategies That Work
Your portfolio's asset mix is a key factor in whether it's profitable. Find out how to get this delicate balance right. -
Nobel Winners Are Economic Prizes
Before you try to profit from their theories, you should learn about the creators themselves. -
Investing During Uncertainty
The inability to forecast future events can turn the markets upside down. Find out how to stay right-side up. -
An Overview Of Commodities Trading
Commodities markets, both historically and in modern times, have had tremendous economic impact on nations and people. Investing in commodities can quickly degenerate into gambling or speculation ... -
The Copper King: An Empire Built On Manipulation
Find out how Yasuo Hamanaka's actions in the copper market forever changed the rules for commodity traders. -
An Introduction To CFDs
The benefits of these securities abound, but high leverage also magnifies potential losses. -
Breaking Down Financial Securities Licenses
Find out which exam you need to begin your career as an investment professional.
Free Annual Reports