loan-loss allowance

noun [C] (also loan-loss provision [C], loan-loss reserves [plural])

Definition

› ACCOUNTING, BANKING in a bank’s accounts, an amount showing what it expects to lose from loans that may not be paid back: The loan-loss allowance allocated to foreign loans was the highest on the bank's books. Despite a 26% improvement in its net income, the bank failed to meet Wall Street's expectations because it had to double its loan loss provision.

(Definition of loan-loss allowance noun from the Cambridge Business English Dictionary © Cambridge University Press)