Correspondent agreement: what it is – Dictionary of Economics

Agreement by which a credit institution provides payment and other services to another credit institution. Payments made through correspondents are usually carried out through reciprocal accounts (“nostro” and “loro” accounts), to which permanent lines of credit can be assigned. Correspondent services are provided, fundamentally, cross-border, but also in some national contexts, where they are known as agency relationships. A “parrot” account is the term used by a correspondent entity to describe an account opened in the name of a foreign credit institution. For its part, said entity considers it an “us” account.

Origin: Bank of Spain