Commercial Law, 2012 Bar — Question 71

MULTIPLE CHOICE

X maintains a savings deposit in the amount of Php-1 Million with ABC Bank Corporation. X also has obtained a loan from ABC Bank Corporation in the amount of Phpl Million. In case of default, A) ABC Bank can set-off the loan from the savings account being maintained by X with ABC Bank. B) Set-off is not possible because legal compensation is not allowed in banking transaction. C) Deposit accounts are usually earmarked for specific purpose hence offsetting is not legally possible. D) Off -setting is not possible because the obligation of X is a “simple loan".

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