Debt security, title to which depends on possession and not an entry in a register maintained by the issuer
A provision in an overdraft required the borrower to reduce or clear the overdraft and/or revolving credit facility for a number of consecutive days a month, so that the facility is used only to manage cashflow and not as a permanent source of finance.
A short term debt security of less than a year (usually 90 days duration)
A debt securitythat gives the holder the right to exchange it for shares in the issuer
The colloquial term for the rate of interest payable on a debt security
The point at which the borrower accesses some or all of the money it is borrowing
Generic term for the debt securities market, because the majority of instruments pay a fixed rate of interest over their life
An agreement that creates a stand-alone primary obligation - unlike a guarantee.
A form of comfort letter
London inter-bank offered rate.
This is that rate at which banks lend to one another
The way in which a bank fund the loans it makes by borrowing on the inter-bank market
A term that prohibits a borrower from granting security to third parties.
Synonymous with 'bond'. i.e. a debt security
Market terms for a country which borrows in the intenrational capital markets (e.g. UK or Sweden)
A facility that enables an issuer to repay commercial paper it is unable to rollover
Slice - usually applies to borrowings where the borrowing or repayment is in instalments
Day count fraction
Basis on which annual interest will be apportioned.
In UK - 365
IN US - 360
Divide by day count fraction and multiple by number of days borrowed.
Time of day for fixing
Usually 11am in London
Working capital facility
- Repayable on demand
- Often contains a clean down provision
Loan of specific sum provided for a specific period of time.
- Usually for a specific purpose
Bilateral term loan
Term loan provided by one bank to the borrower
- Limited amount that can be lent
Loan by more than one bank to the borrower.
When participants in a syndicated loan sell their committment in the loan
Revolving credit facility
Funds can be drawn when needed (like an overdraft) but funds at committed(like a loan)
Very short term (7-10 days) credit facility
Name of parties in a loan
Borrower and lender
Name of parties in a bond issue
Issuer (borrower) and investor (lender)
Working capital facility
Working capital facilities - which fund companies' cashflow gaps - are either overdrafts or revolving credit facilities.
All kinds of bonds such as bonds, loan stock, certificates of deposit, commercial paper.