🏦 Loro Account
📚 US Capital Private Bank Knowledge Base
📖 Definition
A Loro Account is an account held by a third bank, referring to “their account with you” in Latin. It’s the perspective of a third-party bank (a correspondent or respondent bank) describing the account that another bank holds with the correspondent bank. The term is used mainly in interbank communications to identify the ownership of accounts through different banks.
⚙️ How It Works
In a typical correspondent banking relationship, three banks are involved:
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The Respondent Bank (the bank that owns the funds).
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The Correspondent Bank (the bank holding the Nostro and Vostro accounts).
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The Third Bank (the bank referencing the account in question, which is the Loro account from its perspective).
For example, Bank A talks to Bank B about Bank C’s account with Bank B — that account is Bank C’s Loro account from Bank A’s viewpoint.
📝 Key Features
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📜 Represents a third-party bank’s reference to another bank’s account.
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🔄 Used mainly for interbank communications and reconciliations.
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🌐 Helps clarify ownership and responsibilities in multi-bank transactions.
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🏦 Common in correspondent and respondent banking relationships.
✅ Benefits
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Provides clarity in complex multi-bank transactions.
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Helps ensure accurate tracking of funds across different banks.
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Supports transparency and accountability in international banking.
⚠️ Risks & Considerations
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🔄 Complexity in multi-bank arrangements can lead to communication errors.
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⚠️ Potential delays if the chain of accounts is not well managed.
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📋 Requires stringent compliance with regulatory and audit standards.
🔎 Related Terms
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🏦 Nostro Account: "Our account with you" — a domestic bank’s account at a foreign bank.
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🏦 Vostro Account: "Your account with us" — a correspondent bank’s account for a domestic bank.
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🏦 Correspondent Bank: The bank providing banking services to other banks.
📚 References
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📄 Bank for International Settlements (BIS) – Correspondent Banking Glossary
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📄 International Chamber of Commerce (ICC) – Trade Finance Practices
Click to watch a concise overview of Loro accounts and their role in interbank operations.
📞 Contact US Capital Private Bank
📧 Email: [email protected]
🌐 Website: https://uscapitalprivatebank.com