English

According to European Community law and supervisory agreements, credit institutions may – irrespective of any rules on the use of the words “bank”, “savings bank” or other bank designations – use the same name…

Abbreviation for National Association of Securities Dealers Automated Quotation (System). This U.S. electronic stock exchange primarily trades shares of smaller innovative companies that are not listed on the NYSE. – See Madoff system, corporate…

An economy that purchases more goods from abroad than it supplies to other economies within a longer period of time sooner or later becomes insolvent, especially if it does not have sufficient profitable assets…

An economy that purchases more goods from abroad than it supplies to other economies within a longer period of time sooner or later becomes insolvent, especially if it does not own enough profitable assets…

A day of the week on which banks traditionally do not conduct business, even though it is not a public holiday (an otherwise normal day, where banks are closed for business). – Day on…

In the narrower sense, the collectivization of institutions; in the broader sense, the transfer of all financial market institutions to common ownership. – In connection with the financial crisis that followed the subprime crisis,…

The occurrence of a catastrophic event (as storms, earthquakes, volcanic eruptions, cyclones, tidal waves, etc.) which is beyond any human control and which destroys assets. – See contingent loss, catastrophe bonds, risk fund, risk…

In the past, this was a customary fee levied on persons who were granted a right of residence. Some states (including member states and municipalities) still charge such a fee today. – See bride…

In older documents – payment for the service of a shipmaster, whether for the carriage of passengers or goods. – In both cases, complaints accumulated through the ages that upon arrival of the ship,…

In older documents, small, square Turkish silver coins; and hence, in a broader sense, term for desirable small coins of silver. – See money, small change, coin, coin paradox, pezzi, pitis. Attention: The financial…

At the ECB, any day on which the national central bank of a given Member State is open for the purpose of conducting Eurosystem monetary policy operations. – If, on NCB business days, branches…

Separation of personnel in areas of confidentiality within a bank as prescribed and monitored by the supervisory authorities. According to this principle, individual employees may not be provided with confidential information about other areas…

Unless otherwise defined, in the financial market this refers to the collapse of a stock index value by more than three percent compared with the carry forward. – See financial market stress, scenarios, exceptional,…

An instruction issued by authorities such as the government, central bank or supervisory authority to banks to debit certain depositors – usually non-residents – with a charge (commission) specified in terms of amount. The…

In the financial market, the obligation of a creditor to waive the provision of collateral in favor of other lenders. – The binding declaration made by a debtor to the bank not to sell,…

In the financial market, the fact that – banks can never assess the creditworthiness of borrowers with absolute accuracy, even with a high level of rating performance, – their borrowing rates (interest rates) must…

In older documents, the penalty imposed on a public official for neglect of duty (negligence: failure in exercising official duties according to the professional requirements). – See absentee money, penalty money. Attention: The financial…

The ability of a security to be bought and sold in a secondary market; – in a narrower sense: to bring into exchange trade. – See listing. Attention: The financial encyclopedia is protected by…

Unless otherwise defined, a payment to the lead manager after a syndicated loan has been made. – See flex clause. Attention: The financial encyclopedia is protected by copyright and may only be used for…

Negotiations between a creditor (a bank) and a debtor on the individual steps to be taken to pay off an accrued debt (the process to reach an agreement with a creditor to pay off…

In Germany, stock index for innovative growth stocks that were combined in 1997 as a special segment on the Frankfurt Stock Exchange. The Neuer Markt was closed at the beginning of June 2003 after…

Sum obtained after deducting all expenses. The final amount and not subject to any discount or deduction. – The final amount without further deduction (final amount and not subject to any discount or deduction;…

On the stock exchange, the value of a mutual fund share according to the formula: – market value of the fund on a reporting date, – reduced by the liabilities and – divided by…

Unless otherwise defined, this refers to a company’s various assets after deduction of liabilities. The ratio thus formed is often used to determine the “correct” value of a share in a stock corporation (to…

The market value of the fund assets of a capital management company (the value of one share of a fund and equal to the total value of assets, less charges and expenses, divided by…

The total of assets owned by an economic unit (assets: immovable assets [land] and movable assets, namely property, securities, equity interests, receivables together with interest due thereon, and intangible claims [rights of ownership, claims…

At an institution, the positive balance of expenses and income from commissions. Both arise in connection with transactions in securities, asset management, guarantees, payment transactions and other areas. In the Deutsche Bundesbank’s September report,…

In the context of government debt, a country that largely finances its debt domestically, i.e. with domestic households and companies (“we owe it to ourselves”). The largest net creditor in 2010 was Japan. –…

In the case of a company, usually current and medium-term liabilities less cash and cash equivalents. – According to IFRS, cash and cash equivalents plus current securities less pension obligations (commitments concerning pensions, pension…

A term precisely defined by the supervisory authorities in connection with the financial soundness indicators. The following are measured: – the ratio of regulatory capital to risk-weighted assets, – the ratio of regulatory Tier…

For banks, the difference between – gross interest income on loans – plus interest and dividend income from financial assets held for trading and financial investments – less interest expense. – This figure is…

The difference in the amount of the interest rate between two places with different currencies, taking into account hedging costs. – See gross interest rate differential, swap rate. Attention: The financial encyclopedia is protected…

The present value of an investment by discounting the series of payments to the present time. It is the sum of the net surpluses of an investment discounted at an interest rate, namely the…

Net Profit Margin is a profitability ratio that illustrates how much of every dollar of revenue earned results in net income, or profit after all expenses. It’s a key indicator of a company’s financial…

Unless otherwise defined, the net cash inflow from ordinary activities and other current activities within a period (as per IFRS: quantifiable by adding to net income depreciation, amortization, and impairment losses, the net result…

Unless otherwise defined, the net cash inflow from ordinary activities and other current activities within a period (as per IFRS: quantifiable by adding to net income depreciation, amortization, and impairment losses, the net result…

A ratio prescribed by the supervisory authorities as of the beginning of 2018 in the course of Basel III that relates cash outflows and cash inflows at an institution over a period of one…

In economics, a market disturbance caused by deviations from the scale of the market in equilibrium under perfect competition. As a result, the Pareto-optimal quantity is missed, namely the condition where it is not…

In general, the offsetting of payment claims and payment liabilities in accordance with Section 387 of the German Civil Code, especially – within companies of a group (the setting off intra-group transactions in order…

A contract which – by means of a master agreement – links the individual agreements concluded between the parties in such a way that – in the event of termination of the contractual relationship…

The providers of gas, water, electricity and telecommunications services. Because they account for around seven percent of the cost-of-living index in the euro zone, they are the focus of particular attention by the ECB.…

A currency whose circulation is restricted to – a geographically defined area and – that group of people (networkers, downliners, here: people who advertise the use of the secondary currency together with – according…

The creation and management of payment units in computer networks. In Germany, corresponding service providers are subject to supervision by the Federal Financial Supervisory Authority. They also require a license pursuant to Section 32…

Payment units that are only used as a unit of account on the Internet. There are no coins or banknotes for the corresponding unit. It is sufficient that a larger number of people are…

In the field of business, generally the establishment of business contacts via social relationships (to form business contacts through informal social connections); this usually also includes the deliberate and regular cultivation of these contacts.…

Proposed name of the currency predicted by pessimists (new euro) as the successor currency to the EUR, which, due to the high indebtedness of many member states of the euro area, is announced to…

In central bank statistics, lending by institutions in excess of a portfolio. – These are shown for Germany by month in the respective monthly report of the Deutsche Bundesbank, subdivided according to a variety…

The New Buyer Growth Rate is a metric that measures the rate at which a business is acquiring new customers over a specific period. It provides insights into the effectiveness of a company’s customer…

Roughly speaking – increase in production potential as the available supply possibilities of an economy with – stable monetary value and – decreasing unemployment. – See Goldilocks economy. – Cf. ECB Monthly Bulletin, October…

A newly hired employee in a bank, usually with the connotation that he/she has not yet gained sufficient insight into business operations (day-to-day operations). – See jack-of-all-trades, high flyer, high potential, job hopper, low…

Independent trading platform for growth stocks established in 1997 at the Frankfurt Stock Exchange. The Neuer Markt was closed at the beginning of June 2003 after exceptional losses in this market segment threatened to…

Sum of final orders placed by customers with companies, usually relating to the order-driven industry (the value of new contracts for goods produced by the order-driven manufacturing sector). Monitored and evaluated by the central…

The ECB records the first registrations of cars in the euro area and reports them monthly in the annex “Euro area statistics” under the heading “Prices, output, demand and labor markets.” This is because…

Goods recently added to the basket of goods by consumers to be included in the calculation of the cost-of-living price index. The statistics distinguish whether a new good – is purchased by households alongside…

The – certainly not new! – The realization that, in addition to – the supply of money by central banks, the dispositions of capital management companies, companies, private households and public authorities as well…

Formerly common New Year’s gift in money to service personnel, and today still common payment to the letter carrier (CH: Pöstler; mail carrier) and the newspaper deliverer. – Formerly in many places conventional payment…

At a bank, the possibility for customers to be served outside normal business hours. Night” here regularly means the time between the usual close of business and at least 10 p.m. The bank’s night…

Earlier payment to the night-soil man (also Nachtkönig, Abtritiniger, Sekretgraber, Kehrichtlader): a tradesman who collected garbage during the night (came at night to collect waste) and also emptied the latrines (latrines; Abtritte, Senkgruben) according…

In the wake of the subprime crisis, a term used in U.S. financial jargon for high-risk loans, especially for the purchase of real estate. The word Ninja is an abbreviation for “no income, no…

Capital stock of a capital management company for which no issue surcharge is charged (a mutual fund whose shares are sold without a commission or sales charge). The costs incurred are covered by a…

In stock exchange price quotations, a dash after the name of the security or commodity means that – no turnover took place or – that due to special circumstances – such as: by chance,…

In stock exchange price quotations, a dash after the name of the security or commodity means that – no turnover took place or – that due to special circumstances – such as: by chance,…

Isle of Man platinum coin in demand as an investment, containing 1 ounce of platinum in the standard size. – See bullion coin, koala, coin. Attention: The financial encyclopedia is protected by copyright and…

An investor who makes decisions regarding buy and sell trades without the use of fundamental data, because he lacks sufficient knowledge of the market and therefore easily falls prey to fraudsters of all kinds.…

An adjective (adjective; adjective, adjective, adjective) very frequently used in the financial field and always meaning that an amount is expressed in monetary units customary in the place, without reference to the purchasing power…

The principal amount on which an interest calculation is based, especially in connection with swap transactions (the face amount that is used to calculate payments. This amount generally does not change hands and hence…

The capital stock divided into shares (capital subscribed) or share capital of a stock corporation; in Germany, it must currently be at least EUR 50,000 according to legal requirements. – Nominal capital is often…

The interest rate that has not been adjusted for inflation. – In the case of a loan, the contractually agreed interest rate minus various charges, so that the real debiting is always higher than…

The yield of a security based on the nominal value, as opposed to the effective interest rate, which is based on the market value. – See effective interest rate, interest rate. Attention: The financial…

Unless otherwise defined, this refers to the amount for which a debt instrument – a security such as a share – is denominated (the amount of money the issuer received for each paper and…

The agreement in (investment) contracts that a depositor will be compensated with the full amount paid in upon dissolution or termination of the contractual relationship – even in the event of losses by the…

The amount at which a debt instrument – security or share – is denominated, as opposed to the market value of such securities. For interest and dividends, which are calculated as a percentage, the…

In the older financial literature, the claim that money should have no intrinsic value and consist only of materially worthless (paper) bills. – See Money Purpose, Metallist. Attention: The financial encyclopedia is protected by…

Generally, a person or entity named by another to act on its behalf. – In the financial market in particular, a company – usually a bank – that acts as the owner of securities,…

The owner of a share sells it to a nominee. At the same time, he undertakes to repurchase them – at a fixed price – from the straw man after a certain time (the…

In relation to financial markets, an individual or a company that outwardly conducts business for its own account, but in reality executes orders from a third party that remains unknown. In this way, mainly…

In relation to financial markets, an individual or a company that outwardly carries out transactions for its own account, but in reality executes orders of a third party that remains unknown. In this way,…

On the stock exchange, the postponement of the opening in trading in a particular security until a minimum turnover (round lot) in that security, as defined in the relevant stock exchange rules, is pending.…

Structural unemployment that does not generate inflationary pressures and must be addressed by means of labor market policies. – See Balassa-Samuelson effect, Phillips theorem, growth-employment relationship. – Cf. ECB Monthly Bulletin, August 2005, pp.…

Fee payable if a loan provided is – not taken up at all or – not fully utilized. This is because the lender always incurs costs for making the money available, which the borrower…

In government finance, the principle that public revenues may not be earmarked for specific expenditure purposes. In Germany, earmarking is permitted under budgetary law in some cases (e.g. motor vehicle tax, CH: Motorfahrzeugsteuer; motor…

As a regulatory term, an entity that is neither a bank nor an insurance company, but nevertheless plays a significant role in shaping the financial cycle. These include, in particular, hedge fund companies, securitization…

In earlier documents, a place where either – no bank (branch) was located or – no central bank branch was located. Money shipments had to be handled here by the postal service. Bills of…

In the past, this was a tax levied on local residents without full political rights, especially in towns and cities. – See Beisitzergeld. Attention: The financial encyclopedia is protected by copyright and may only…

A jargon, but unofficial, term for a bank from which a customer cannot withdraw cash from his or her account. Such companies are generally prohibited under Section 3 № 3 of the German Banking…

A jargon, but unofficial, term for a bank from which a customer cannot withdraw cash from his or her account. Such companies are generally prohibited under Section 3 № 3 of the German Banking…

Forward exchange transactions in which no currency swap (settlement) is agreed from the outset. Instead, a settlement payment equal to the difference between the contractually agreed exchange rate and the exchange rate on the…

A financial investment that should be discouraged in advance because of the excessive risk of loss (low-quality notes or bonds that may be in danger of default because of the comparatively high levels of…

In the U.S., a bank that is not a member of the Federal Reserve System or an institution that is not a member of a clearinghouse association. – See Federal Reserve System, Office of…

Generally, a loan for which repayment in full is doubtful and for which a specific valuation allowance is required on the part of the bank. In Germany, the share of non-performing (bad) loans in…

Loans granted by companies to banks – and also increasingly to hedge funds – for the sole purpose of improving the balance sheet structure; i.e. not to make investments. This is also referred to…

In the case of a bond, the contractually defined years during which, in the case of a fixed-interest bearing security, interest is paid but no amortization of the bond amount occurs. – See amortization,…

In the terminology of the forced exchange economy, an entity whose domicile is assumed to be outside the respective currency area (an entity who is regarded as non-resident in the currency area). – See…

Economic agents who do not have their permanent residence in a state or currency area; formerly also called non-residents. – See negative interest rate. Attention: The financial encyclopedia is protected by copyright and may…

The omission of information from a survey; the respondent leaves the relevant question unanswered. This also has significance for statistical surveys of the central bank. An attempt must be made to find the denied…

In old documents, a ninth part or portion, esp. of movable goods, once to be paid to the poor box or charity upon death of affluent people. – See Armengeld, Detz, Fallgeld, Sterbegeld, Zehnt.…

Securities which – were worthless from the outset, including counterfeits, – have since become worthless, or – appear worthless under the circumstances. These two last-mentioned types can, if they are in paper form, possibly…

This institution, headquartered in Flensburg, ran into difficulties due to reckless lending by the former independent Sparkasse Flensburg, which merged with the healthy Nord-Ostsee Sparkasse in 2008. Various support measures by the savings bank…

A merger or cooperation of several stock exchanges in the geographic area designated by the name. – See ECB Monthly Bulletin of November 2007, pp. 71 f. (origins of the OMX; participants; trading systems).…

A distribution of values around a mean value that is generally encountered on the financial market in cases where a large number of purchases and sales take place. The normal distribution is characterized by…