compensating balance


noun

Also compensated balance, compensation balance. a balance wheel in a timepiece, designed to compensate for variations in tension in the hair spring caused by changes in temperature.
Banking. a deposit balance that is required to be left on deposit by a company to maintain or guarantee credit.

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Origin of compensating balance

First recorded in 1795–1805
Dictionary.com Unabridged Based on the Random House Unabridged Dictionary, © Random House, Inc. 2020