The term “nostro account” describes the situation in which a bank holds a foreign currency account in another bank. Nostro descends from the latin word for “ours” and is used to name a situation in which to bank institutions are sharing an account.
The opposite is “vostro account”, describing how a bank refers to the accounts that other banks have on its books in its home currency.
So whether it is vostro or nostro depends on the perspective, one´s nostro account is the other one´s vostro account.
Got curious about the world of financial jargon? So stay tuned!
As always, do not hesitate to approach if you have any questions.
WHU Finance Society