Foreign Deposits

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DEFINITION of 'Foreign Deposits'

A deposit made at, or money put in to, domestic banks outside of the United States. These deposits are not subject to deposit insurance premiums (a premium paid to ensure that funds can be retreived if the debtor cannot repay the deposit), or reserve requirements (the amount of funds an institution must hold relative to its deposits).

BREAKING DOWN 'Foreign Deposits'

The leniency awarded to foreign deposits regarding deposit insurance and reserve requirements is in effort to compete with the offshore banking centers.

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RELATED FAQS
  1. Are my investments insured?

    No. Whenever you invest in a stock, bond or mutual fund, there is no insurance against the possible loss of your initial ... Read Full Answer >>
  2. Are all bank accounts insured by the FDIC?

    The Federal Deposit Insurance Corporation (FDIC) is an independent agency of the U.S. government that protects you against ... Read Full Answer >>
  3. How does investment banking differ from commercial banking?

    Investment banking and commercial banking are two primary segments of the banking industry. Investment banks facilitate the ... Read Full Answer >>
  4. Why do commercial banks borrow from the Federal Reserve?

    Commercial banks borrow from the Federal Reserve primarily to meet reserve requirements when their cash on hand is low before ... Read Full Answer >>
  5. How does a bank determine what my discretionary income is when making a loan decision?

    Discretionary income is the money left over from your gross income each month after taking out taxes and paying for necessities. ... Read Full Answer >>
  6. What role does a correspondent bank play in an international transaction?

    A correspondent bank is most typically used in international buy, sell or money transfer transactions to facilitate foreign ... Read Full Answer >>

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