English

In Germany, these companies, which are important for the financial market on account of their premium income and asset investments, are subject to supervision by the Federal Financial Supervisory Authority. The authority also examines…

The special management of liability-side items in the balance sheet with regard to the return, risk and payment terms of liabilities. In banks, this is often the task of a separate working group made…

Legal provision stipulating the partial expropriation of a bank’s customers’ deposits if the bank runs into difficulties. In the course of the Cyprus crisis in spring 2013, depositors with more than 100,000 euros were…

A swap transaction in which – fixed-rate refinancing is swapped for variable-rate refinancing (fixed-rate receiver swap) or – variable-rate refinancing is swapped for fixed-rate refinancing (fixed-rate payer swap). – See asset swap. Attention: The…

Company that assumes liability for contractually bound intermediaries. – See fund intermediaries, KWG Intermediaries Ordinance, insurance intermediaries. – Cf. 2013 BaFin Annual Report, p. 111 (investigations by the public prosecutor’s office against liability umbrella).…

The obligation, regulated in detail by the legal system, for the assumption of damage by someone other than the person directly affected; the obligation for damage compensation. – Responsibility for the consequences of one’s…

In older financial language, said for – collecting a sum from – very many people and – in very small individual amounts. – The term goes back to the liard, an old French small…

Interest rate at which banks lend money to each other for various periods of up to one year. Currently, LIBOR is calculated – daily – for fifteen terms (time limits) and – for ten…

The spread in the interest rate between LIBOR with respect to different maturities; the spreads are shown in the “Euro Area Statistics” annex “Financial Markets” in the respective ECB Monthly Bulletin. – swap transaction,…

In older documents – the name of a special business tax levied on a number of businesses, including notaries, auctioneers and similar professions; – an excise tax introduced in German territorial states. – Payment…

A fee that used to be paid by the authorities for permission – to carry on a licensed business (e.g., pharmacy) or – to mine mineral resources in a defined area; this is not…

In old documents, coins that an authority accepts on account of payment. Sometimes called cash money in this sense. – See acceptance compulsion, cash, money mark, cash money, land money, transfer, final, payment. Attention:…

In relation to financial markets, the official permission for banks. In Germany, the Federal Financial Supervisory Authority (BaFin) and the European Banking Authority (EBA) grant the relevant license. Several lawsuits against this restriction of…

In older documents, the (customary) payment received by a Lidl (Tagelöhner, Mietling, Heuerling; hireling: an unskilled worker hired and waged by the day; in modern English the word “hireling” generally is used derogatory: a…

A recurring payment usually made until the death of the beneficiary; cf. sections 759 et seq. BGB (a type of pension contract that guarantees periodic income payments throughout the lifetime of a named person,…

An insurance policy that, upon the death of the policyholder, – pays for the policyholder’s debts up to a certain limit specified in the contract (pays off a specific amount of debt) and/or –…

Business in which policies are purchased by the policyholder and transferred to others. A basic distinction is made between U.S., British and German secondary market trading. These three secondary markets have, in some cases,…

Unless otherwise defined, this refers to the pledging of a life insurance contract to a bank as collateral for a loan. In the process, it is determined on a case-by-case basis who is to…

Lifetime Value (LTV), also known as Customer Lifetime Value (CLTV), is a prediction of the net profit attributed to the entire future relationship with a customer. It helps a company understand how much revenue…

Formerly, in various places in Germany, a levy paid by pupils to teachers – Schulmeister (schoolmaster) and Hilfslehrer (assistant teacher, supply teacher), the latter also called Behelfer in older literature – and a salary…

The payment due for unloading (= lightering) a means of transport in general and a ship in particular (price for unloading cargo). – See handling charges, anchorage charges, discharge charges, boarding charges, honorarium, foreign…

A charge payable by ships when entering a port equipped with a lighthouse or an area secured by light signals, usually included in the harbor dues; see § 621 HGB. – See anchor dues,…

A tax that used to be paid on the artificial lighting of a room. It was in the tradition of the candle wax tax (candle wax impost). The basis of the levy was the…

According to these recommendations, internationally active banks should – have to spin off their trading activities into a legally independent company; this includes proprietary trading as well as market making and hedging for their…

In older financial terminology, the upper or lower limit of an order, in particular when buying or selling securities or commodities at an exchange price. – See all-or-nothing order, cap, GTC order, limit, safety…

In financial language, it always means a restriction, a cap, a barrier, especially in the sense of – a maximum price (peak price), – a price ceiling (upper limit), – an agreed price limit…

The order to buy or sell an asset at a specific price on the stock exchange (a trading order placed with a broker to buy or sell an asset at a specific price). –…

Said in connection with a central bank’s minimum reserve policy. By increasing and decreasing the reserve requirement, the central bank defines the framework within which banks can operate. – Only in extreme situations, however,…

Limits placed by the exchange organizer on the price change for a commodity within a trading session. – See price fluctuation limit, limit, tick. Attention: The financial encyclopedia is protected by copyright and may…

Means of payment in the global meta-universe “Second Life,” a user-defined virtual parallel world. The system, which has been available since 2003, has around 28 million registered users, and up to 60,000 members are…

If not defined otherwise, the accusation that the English language dominates the globe and that the financial world with its jargon is the forerunner of this development. – The fact is, however, that the…

If not defined otherwise, the accusation that the English language dominates the globe and that the financial world with its jargon is the forerunner of this development. – The fact is, however, that the…

In ECB terminology, a contractual and technical arrangement whereby securities can be appropriately transferred between two securities settlement systems that are not directly linked via a third system acting as an intermediary. Attention: The…

In ECB terminology, a contractual and technical arrangement whereby securities can be appropriately transferred between two securities settlement systems that are not directly linked via a third system acting as an intermediary. Attention: The…

Said in connection with a central bank’s reserve requirement policy. For a central bank to keep the overnight rate under control, there must be sufficient demand for deposits (credit balances) at the central bank.…

In ancient documents, coins with the lion on the reverse. From the time, place, and context of the text, it must be inferred which coins are involved each time. – See land money, lion…

Term used in financial journalism, but rarely used in the language of monetary authorities, meaning that the supply of money is high; and usually because the central bank injects ample liquidity into the market.…

Term used in financial journalism, but rarely used in the language of monetary authorities, meaning that the supply of money is high; and usually because the central bank injects ample liquidity into the market.…

Assets that can be readily converted into cash. – The sum of a company’s cash and free credit lines. – See buffer. Attention: The financial encyclopedia is protected by copyright and may only be…

In older documents, the term for a creditor who asserts his claim. In this context, the debtor in question is also called the respondent debtor. – See Default, Payment. Attention: The financial encyclopedia is…

In financial terminology, this refers to converting an asset into cash. – See exit, liquidity, liquidity forms, liquidity buffer, liquidity premium. Attention: The financial encyclopedia is protected by copyright and may only be used…

The cessation of a company’s business and dissolution of the company’s assets, see § 145 et seq. HGB, in older documents often also called Stralzio (in English sometimes also called winding-up and dissolution, although…

In the narrower sense, central bank money, also referred to as base money at the ECB. – In a broader sense, central bank money plus foreign exchange plus immediately redeemable money market paper; the…

At a bank, the stock of highly liquid assets relative to total assets. – See equity capital, funding ratio, medium-term, financial strength, liquidation, core capital, liquidity maturity balance sheet, liquidity coverage ratio, liquidity ratio,…

For a bank, the potential net funding requirement of the bank over a horizon at a specified confidence level. This measure can be used to roughly determine how much liquidity an institution must hold…

Part of a business entity’s financial plan aimed at ensuring sufficient solvency at all times (internal scheduling used to keep track of inflows and outflows of cash transactions). – See balance reporting, bank size,…

In general, all assets of companies and banks that are readily saleable and, therefore, can be easily converted into cash in the event of a financial crisis. – In the course of the financial…

In the wake of the worsening financial crisis, the German Federal Financial Supervisory Authority (BaFin) temporarily introduced daily, and later weekly, reporting requirements for certain institutions on their liquidity situation in September 2008. –…

Unless otherwise defined, organizational precautions taken by a bank in the event of a liquidity shortage. – In view of the experience gained from the subprime crisis and the subsequent financial crisis, the Basel…

Based on a thirty-day period, this ratio relates an institution’s stock of highly liquid assets to its net payment liabilities under stress. A minimum level of certain highly liquid assets can be prescribed as…

Generally, the obligation to provide liquidity to a counterparty, also called a liquidity line. – The credit limit granted to a business entity by the bank, the credit line (credit line committed by a…

At the ECB, all influences not stemming from the use of monetary policy instruments. These include – the circulation of ECB banknotes, – the deposits of public households at the central bank, – the…

At a bank, the forward-looking calculation of outflows and inflows of liquidity. – A liquidity gap exists if, at a certain point in time, the forecast cash outflows are greater than the calculated inflows.…

For banks, the total of – autonomous factors, – reserve requirements and – excess reserves (i.e. institutions’ balances with the central bank in excess of reserve requirements). – See Banking system liquidity, Liquidity provision.…

A precisely defined quantity at the ECB, consisting of the Eurosystem’s monetary policy operations and autonomous liquidity factors. – See benchmark allotment, money market operations, money creation sector, liquidity needs, liquidity provision. – For…

Regulatory provisions enacted by EU directive in 2007 on the liquidity of banks, including issuers of electronic money. According to the LiqV, an institution’s liquidity is generally considered to be sufficient if – the…

All measures taken by a bank to ensure its unconditional, unrestricted solvency at any time. – In the course of the subprime crisis and the ensuing financial crisis, it became apparent that some banks…

All measures taken by the central bank to inject or withdraw its monopoly money from the banking system. – Provision of ample liquidity with the aim of reducing government debt. This is seen as…

A cash account called for by some economists into which larger banks would pay according to a certain distribution key. In the event of bottlenecks, the institutions could be supplied from this pool. This…

In the ECB’s statistics, this refers to the euro area banking system as a whole and comprises the euro balances on credit institutions’ current accounts with the Eurosystem. This figure, which is important for…

The tendency of economic agents to hold cash and demand deposits instead of buying interest-bearing securities. In economics, this behavior is explained in various models with varying degrees of conviction. Empirical studies, however, have…

The price someone is willing to pay, usually in the form of a lower return, for a liquid asset compared with an illiquid one. – In the case of a loan, the compensation included…

The amount of liquidity calculated according to various formulas to measure the ability and willingness of a bank – and of a company in general – to meet its payment obligations on time and…

Unless otherwise defined, this refers to the available liquid assets consisting of cash on hand, balances with banks and securities (current assets: cash and other assets that are capable of being converted into cash…

The ratio of available funding to the stable funding required by the supervisory authorities. The NSFR is thus intended to ensure that institutions are not overly dependent on short-term and thus comparatively highly fluctuating…

In the case of a company, near-money assets. – In the case of a bank, assets that can be sold to the central bank at any time and that are not used for refinancing…

In general, the risk of not having sufficient liquidity available to settle liabilities due on time (the eventuality of not having access to liquidity or unutilized credit facilities in order to settle payments due).…

The sudden, unexpected lack of liquidity for – an individual institution or – for the market as a whole, as occurred in the course of the subprime crisis and drove even large banks into…

Economic entities – companies, private households – do not have enough cash and are unable to obtain it due to already exhausted refinancing options – not on time – only at very high cost…

Generally, exchange transactions on the financial market in the event of a significant liquidity differential in relation to assets. – In particular, corresponding transactions between banks and insurance companies. Within the framework of liquidity…

The central bank provides liquidity very cheaply, but the money is not in demand because households and companies – expect price cuts and are therefore reluctant to spend and borrow, – investing in asset…

A ratio expressing the loss of assets that a bank would incur as a result of higher refinancing costs, but which would not be exceeded with a certain probability. There are various templates for…

In the narrower sense, the sum of the reserves of foreign exchange and gold held by all the world’s central banks. – In the broader definition, all holdings of foreign exchange and gold reported…

In a company – a bank – a state in which – all due payment obligations can be met currently and in the future without restriction, and in which – cash and cash equivalents…

Goals formulated by the European Council in 2000 for the EU as a whole. According to these goals, the European Union is to become the most competitive and change-friendly economic area in the world.…

Agreement signed by the heads of state and government in December 2007 and further developing the EU, which entered into force on December 1, 2009 after ratification by the 27 participating states, thus replacing…

Especially in older documents, a list of services and respective prices, which in the forwarding business an entrepreneur (namely – carrier: a person or firm in the business of transporting people or goods or…

Especially in older documents, a list of services and respective prices, which in the forwarding business an entrepreneur (namely – carrier: a person or firm in the business of transporting people or goods or…

In older financial language, a list of income or assets, especially in connection with tax payment. Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes without express…

The admission of a security to trading on the stock exchange by the exchange admission board. Thereafter, the security also appears in the current price list. – See issue, secondary placement. Attention: The financial…

In France, the monetary unit from the 9th to the 18th century. – From 1795 to 2002, the French franc (ISO code: FRF) was the unit of currency; from 2002, the euro. Attention: The…

The payment to be made for loading (freighting; freighting a vessel; stowing; then also called stowage) or unloading (discharging, unloading) goods in port or ashore. – In the past, seagoing vessels needed a certificate…

Often equated with loading fee, especially in older documents, namely the payment to be made for loading or unloading goods in port or also on land. – The charge levied on trucks transporting goods…

Often equated with loading fee, especially in older documents, namely the payment to be made for loading or unloading goods in port or also on land. – The charge levied on trucks transporting goods…

Loan to an issuer of securities through the purchase of those securities. – See Italian method. Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes without express…

Loan to a customer which, in all probability, cannot be serviced (or can no longer be serviced) by the customer in accordance with the terms of the agreement. As a rule, the bank extends…

If a service provider provides a loan to a private household against payment, such a contract must be executed in writing. Further provisions are set out in Sections 655a to 655e of the German…

In general, amounts that are offered and demanded on the financial market for a fixed term and against interest. – In a narrower sense, money lent by banks for investment purposes. – See lending,…

In the case of an institution, the legally binding promise to grant a customer a loan at an agreed date (the promise of a bank to lend an agreed sum of money at a…

A bank grants a customer a facility under contractually agreed terms. A long period of time may elapse before the facility is drawn down, i.e. the loan is called. Typically, therefore, the bank reserves…

A bank grants a customer a facility that the customer can dispose of unconditionally at any time. – Such a commitment by the bank has the effect of enhancing creditworthiness (enhancement of soundness) and…

A bank undertakes to provide a customer – with a loan of a fixed amount – at a specific date and – at an interest rate agreed in advance. For the bank, this gives…

A borrower – for example, a builder – is liable for the loan only with the collateral provided for the purpose – in this case, the house – but not with his assets in…

A loan of money is granted by anyone who concludes a loan agreement under private law within the meaning of Section 488 of the German Civil Code (BGB) or a comparable agreement under foreign…

Employees of a bank who perform all work related to the processing of loans to companies and private households as well as any resulting debt rescheduling. They advise customers on credit matters, process loan…

Generally an activity of banks in which – non-tradable assets. such as mortgage receivables or loans to companies, are pooled, – converted into marketable securities (marketable papers) and – sold to investors. Banks usually…