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      Question

      The 'Nostro Account' of a bank refers

      to:
      A An account maintained by a foreign bank with the bank in the domestic country. Correct Answer Incorrect Answer
      B An account maintained by the bank with a foreign bank in a foreign country. Correct Answer Incorrect Answer
      C A loan account of a non-resident customer. Correct Answer Incorrect Answer
      D A special current account for government transactions. Correct Answer Incorrect Answer

      Solution

      A Nostro Account (from the perspective of the domestic bank) is an account held by the domestic bank in a foreign bank, denominated in the foreign currency. It facilitates international trade and forex transactions.

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