in the bank’s balance sheet: ⬆️ +$100 assets - the loan they just issued ⬆️ +$100 liabilities - the $100 your account was credited with your loan is an asset to the bank - and your loan itself funds the $100 deposit that you get in your account

Illya Gerasymchuk 2025-08-05 21:39

the bank needs a liability to fund an asset when a bank gives you a loan it gains both an asset and a liability in the same amount let's say you get a loan for $100