Contingent Liability
Contingent Liability
Definition: Potential claims on bank assets for which any actual or direct liability is contingent upon some future event or circumstance. Contingencies usually result from off-balance sheet lending activities such as loan commitments and letters of credit. Other examples are pending litigation in which the bank is defendant and contingent liabilities arising from trust operations.
Definition: Potential claims on bank assets for which any actual or direct liability is contingent upon some future event or circumstance. Contingencies usually result from off-balance sheet lending activities such as loan commitments and letters of credit. Other examples are pending litigation in which the bank is defendant and contingent liabilities arising from trust operations.