New RBI Grade B 2025 Notification will come Soon! Enroll Here

    Question

    Union Bank of India opening a dollar account with

    Citibank in New York is called as -
    A Core Account Correct Answer Incorrect Answer
    B Nostro Account Correct Answer Incorrect Answer
    C Vostro Account Correct Answer Incorrect Answer
    D Forex Account Correct Answer Incorrect Answer
    E Capital Account Correct Answer Incorrect Answer

    Solution

    A nostro account will be in foreign currency (it is a record of funds held by a bank in another country in the currency of that country) i.e. a bank in country A keeping a record of money held by a bank in country B, in the currency of country B. A vostro account will be in the local currency of the bank where the money is being held i.e. it is the bank in Country B's record of the money kept by the bank from country A with it.

    Practice Next

    Relevant for Exams: