English

Those countries in Europe that have adopted the EUR as their common currency. At the beginning of 2014, these were eighteen countries, namely Belgium, Germany, Finland, France, Greece, Ireland, Italy, Luxembourg, Malta, the Netherlands,…

Constantly repeated phrase that appeared in all media in 2009 at the latest in the wake of the Greek crisis. In terms of content, it means that the euro zone is facing problems due…

Term frequently used in the business press to refer to the European Stabilization Mechanism (ESM). – See Stabilization mechanism, European Attention: The financial encyclopedia is protected by copyright and may only be used for…

The proposed merger of existing national evidence centers, i.e., all credit registers and information procedures, into a pan-European authority. – Whether such a central administration would bring substantial benefits is debatable. Close cooperation among…

The nominal effective exchange rate of the EUR, as calculated by the ECB, is a weighted geometric average of the exchange rates of the EUR against the currencies of the currently 38 most important…

A large number of savers and investors are withdrawing from EUR-denominated accounts and securities and switching to another currency, especially GBP, CHF or USD, or buying precious metals, especially gold. Such movements indicate that…

A standardized collateralized money trade as a platform introduced by Eurex; Euro GC Pooling acts as the central counterparty. – The market operates in a similar way to a stock exchange, except that instead…

Average value for various money market rates in European interbank trading. – For this rate, banks from the EU report daily offered rates (ask rates) for one- to twelve-month deposits at 11:00 a.m. Brussels…

Method of interest rate calculation in which interest rates are calculated to the nearest day, with the year being assumed to be 360 days for the purpose of determining the interest rate divisor. –…

Supply and demand for short-term funds denominated in euros. Market participants are primarily banks and funds. – See money market, money market segments, money market volatility. – Cf. ECB Monthly Bulletin, February 2008, pp.…

Short- to medium-term debt securities issued on the euro money market. These can be issued in any currency (i.e. not necessarily in EUR). – See certificates of deposit, euro commercial paper. Attention: The financial…

Sometimes used German term for the Single European Payment Area. Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes without express consent! University Professor Dr. Gerhard Merk,…

Guidelines adopted by the European Council in March 2011 with the aim of achieving coordination in the areas of social affairs, taxation and budgetary policy. It does not include binding recommendations or even sanctions.…

Market price of the euro against the major international currencies and the currencies of the countries belonging to the European Union or with which EU accession negotiations have been initiated, calculated and published by…

Another name for the European Stabilization Mechanism (ESM). Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes without express consent! University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.…

Board established by the ECB in December 2013 with the task of promoting the development of an interconnected and competitive retail payments market in the EU. The Board is composed of seven representatives from…

Index of shares from countries in the euro area. The index calculated by the Dow Jones Group is also calculated in subindices – for market sectors and for industries. – See the current values,…

Major large-value payment system operated by the Euro Banking Association. EURO1’s customers are European banks. In spring 2013, EURO1 processed around 230,000 payments per day with a total value of over EUR 245 billion.…

Unless otherwise defined, this refers to issues that should be placed on the market jointly by different euro area countries, by a European debt agency. – Until now, Germany in particular has resisted such…

Clearing system for international securities transactions founded in 1968 by Morgan Guaranty Trust Co. in Brussels (user-owned, user-governed, Belgium-based financial services company that specializes in the settlement of securities transactions). Today, Euroclear is the…

Accounts in USD held outside the United States, primarily in Europe, and here again especially in London and Zurich (any holding of USD outside the jurisdiction of the United States and used chiefly as…

An informal circle of ministers from the Ecofin Council in whose countries the EUR has been introduced, until the entry into force of the Lisbon Treaty on December 1, 2009. The circle meets regularly…

The adoption of the EUR as a currency unit by a country that is not part of the European Monetary Union. – Advantages are – the adoption of a stable currency, – lower interest…

Territory of those EU member states that have adopted the EUR as their single currency. At the beginning of 2014, these were nineteen of the twenty-eight EU states. The non-official term (Article 282 TFEU…

Unless otherwise defined, the aggregate trading in bonds among banks and issuing institutions in Europe, i.e. not only within the euro area. Attention: The financial encyclopedia is protected by copyright and may only be…

Exchange organization established in September 2000, created by the merger of the cash and derivatives exchanges of the financial centers of Amsterdam, Brussels and Paris. In the meantime, the Euronext exchange group has grown…

Uniform supranational legal form for companies established in two or more EU member states. The SE, which has been possible since mid-2005, is a uniform legal shell for stock corporations domiciled in the EU;…

A term that emerged after 2010 for those EMU member states that, contrary to the original agreements, are liable for the debts of other members and ultimately have to pay them. This is ultimately…

Targets set by the EU Commission in 2010 and approved by the EU Council on employment, climate protection, education, research and poverty reduction. All the targets set in detail can only be achieved –…

EU authority established in 1999 and based in Brussels to detect possible irregularities in all Community institutions. It has far-reaching powers and, following a ruling by the European Court of Justice in July 2003,…

An institution established in 1991 after the dissolution of the countries of the former Eastern Bloc. Its business objective is to support countries in Central Europe, Eastern Europe and the Commonwealth of Independent States…

London-based pan-European supervisory authority created from the Committee of European Banking Supervisors at the beginning of 2011 with certain powers to issue instructions also to national supervisory authorities. – Roughly speaking, the EBA lays…

Investment services firms are granted the European passport, introduced in 1996, on the basis of authorization in their home country. This allows them to establish branches in another EU member state or EEA contracting…

A derogatory term for the European Central Bank, introduced by financial journalists around 2010. At that time, the ECB had to double its subscribed capital to cushion impending write-downs on toxic securities it had…

The central bank established in 1998 and responsible for the euro area, based in Frankfurt am Main. The ECB is a supranational institution with legal personality; it had 1,536 employees at year-end 2008. –…

EU authority based in Luxembourg with the task of auditing the legality and proper use of the income and expenditure of all EU departments. This includes the audit of the ECB’s budget; the corresponding…

Proposed agency with the task of – managing the sovereign debt of all members of the European Monetary Union and – also issuing common sovereign bonds for which all members are liable. – The…

The twenty-eight EU states plus Iceland, Norway and Lichtenstein. Switzerland has an observer status in the EEA bodies. – See EEA countries, economic area. Attention: The financial encyclopedia is protected by copyright and may…

Association of leading European economic research institutes, which regularly publishes a highly regarded economic report. This report also assesses the state and development of the financial sector, often in contrast to the ECB’s assessment.…

A procedure proposed by the EU Commission in the wake of the Greek crisis in spring 2010, whereby EU member states – initially perhaps only the member states of the European Monetary Union –…

association of banks from the euro area with the main objective of establishing uniform procedures and rules of conduct in the financial market (ACI is a leading, global association of wholesales financial market specialists,…

Advisory body set up by the major banks and insurance companies in the EU in 2001 with the main aim of creating a single European financial market. The secretariat of the body is located…

Fund established in June 2010 and initially limited until 2013 (special purpose vehicle, legally a joint stock company under Luxembourg law [Société Anonyme]), based in Luxembourg), fed by the members of the euro zone,…

Body established at the ECB, resulting from a voluntary cooperation of competent authorities of the European Economic Area (EEA) responsible in particular for the oversight of payment service providers and payment oversight. The committee…

The Authority, which is based in Frankfurt am Main, began its work at the beginning of 2011. Its main tasks are binding supervisory rules, a uniform supervisory culture throughout Europe, peer reviews and the…

Financing bank of the EU based in Luxembourg. Its equity capital was subscribed by the member states of the EU. The bank provides loans and guarantees mainly for investments aimed at opening up less…

Uniform European basic form for master agreements on almost all transactions in the financial market, developed by the leading associations of the banking industry in Europe. The EMA is available in almost all official…

In early June 2011, the President of the European Central Bank, Jean-Claude Trichet, was awarded the International Charlemagne Prize in Aachen. In his acceptance speech, he put forward the proposal of communitarizing fiscal policy…

In view of the difficulties encountered by EU member states, particularly in the wake of the subprime crisis – Iceland, a member of the European Economic Area, had to be rescued from national bankruptcy…

Authority established on January 1, 1994, with the start of Stage Two of Economic and Monetary Union, based in Frankfurt am Main and headed by the Belgian financial expert Baron Alexandre Lamfalussy. The two…

international monetary association which entered into force in March 1979. The EMS focuses on – the fixing of central rates and – the range of exchange rate fluctuations of the individual currencies. – Following…

The agreement of several European countries to introduce a common currency in the form of the euro (ISO code: EUR). The monetary union came into effect on January 1, 1999 in the form of…

The crucial constructional fault of EMU is seen in the fact that member states can impose their budget deficits on other members behind the scenes, covertly and inconspicuously. This happens in the following way.…

Paris-based institution founded in 1950, whose main objective was to bring the participating currencies to convertibility as quickly as possible; this was achieved as early as 1958. An important step in this direction was…

A body set up by the European banking industry in the summer of 2002 with the aim of promoting the establishment of a single European payments area. The Payments Council established a common remittance…

an EU body established in 2002 and chaired by the European Commission to deal with securities regulatory issues. – Cf. ECB Monthly Bulletin, May 2002, p. 71. Attention: The financial encyclopedia is protected by…

Special fund planned by the EU Commission in connection with the bank resolution facility, from which insolvent institutions are to be fed. Such a fund aims to redistribute risks between the banks of the…

A training program for the staff of European supervisory authorities, structured in coordinated individual courses (the primary intention is combining knowledge and experience of practitioners and researchers to instruct European supervisors of banks, insurance…

set of rules for the statistical recording and allocation of macroeconomic stocks and flows. By ordinance of the EU, this statistical nomenclature is to be applied bindingly throughout the EU. The Statistical Office of…

European Central Bank and the national central banks of all member states of the European Union. Thus, in addition to the members of the Eurosystem, it also includes the national central banks of those…

A body set up in December 2009 in the wake of the subprime crisis, which became a financial crisis, with the aim of coordinating more closely the work of the national European supervisory authorities…

A committee established in 2010 in the wake of the subprime crisis, which developed into a financial crisis, with the aim of identifying systemic risks at an early stage; in particular, to detect speculative…

unit of account within the European Payments Union, practically the U.S. dollar. – As far as mainly agricultural prices were fixed in ERE, goods prices were profoundly affected by parity changes of the member…

In its composition and value, a unit of account defined by a basket of currencies in the then European Community, introduced in 1975. It was replaced in 1981 by the ECU, with which it…

The pathological rejection of the EUR as a means of payment; the refusal to recognize the EUR as money, anchored within a person and hardly comprehensible in factual terms. This attitude can be found…

Statistical Office of the European Communities, based in Luxembourg. It has the rank of a Directorate-General of the European Commission and is attached to the Commissioner for Administration, Audit and Anti-Fraud. Among other things,…

As defined in Article 282 TFEU, the European Central Bank (ECB) and the national central banks of those European Union Member States whose currency is the EUR. – Only when all EU Member States…

a procedure for the uniform assessment of the credit quality of collateral submitted to the ECB (underlyings: assets which credit institutions pledge to the central bank as collateral for short-term liquidity loans and assets…

Office established by the ECB in 2007 with the aim of coordinating the procurement activities of the European central banks. – Cf. ECB Annual Report 2007, p. 216. Attention: The financial encyclopedia is protected…

The euro currency area. The non-official term comes from French, but meets with reluctance in England and not only in Germany (zone, a Greek word [ζωνη] = pinching off part). – See Euroland, euro…

Strategies adopted by banks to at least partially evade supervision by the relevant supervisory authority by exploiting legal loopholes or by relocating operations to faraway foreign countries. Reasons for avoidance can be, above all,…

Especially in betting games, the full payout of the wagered amount minus a management fee in case of a win (one-to-one payout on the wager, but usually with the exception that the bank takes…

A short-term loan granted by a bank to the organizer of a festivity such as a concert, stage play or similar performance. The loan is intended to enable the organizer to cover the expenses…

A short-term loan granted by a bank to the organizer of a festivity such as a concert, stage play or similar performance. The loan is intended to enable the organizer to cover the expenses…

At an institution, an employee responsible for event marketing. Since around 1980, even in provincial banks – and often there in particular! – Event managers have raised the profile of many banks by organizing…

In the case of banks, events of all kinds that – are not directly aimed at acquiring new customers, but – are primarily intended to expand the institution’s name recognition or enhance its reputation,…

In the financial market, an event that – on the part of the bank – constitutes a reason for termination. Basically, it is always a case of non-compliance with contractual agreements on the part…

The consideration of events due to which market distortions and, as a consequence, major price fluctuations in commodities or/and financial products are to be expected. – See contingent loss, exposure, flash crash, risk, systemic,…

The risk that the value of a debt security or an ownership title will vary suddenly as the result of a change in the market price of a financial instrument. The reasons for this…

Ereignisgesteuerter Fonds): Hedge funds that seek to profit from specific events in companies and their environment (event driven hedge funds are those that follow a strategy unaffected by the general direction of markets; instead…

An agency required by banking supervision – in Germany regulated by a separate ordinance – or established on the basis of a voluntary agreement between banks, to which large loans must be reported. The…

A condition in which domestic final demand exceeds domestic production capabilities. This leads to domestic CETERIS PARIBUS inflation. At the same time, there is an increase in imports; and the exchange rate of the…

A condition in which domestic final demand exceeds domestic production capabilities. This leads to domestic CETERIS PARIBUS inflation. There is a simultaneous increase in imports; and the exchange rate of the currency in question…

If a central bank increases the money supply with the aim of stimulating investment in the capital stock (as was the case in the U.S.A. between 1987 and 2001), market participants with a low…

The amount of cash held by an individual bank in excess of the usual requirement in its day-to-day operations. – Total by which banks’ balances with the central bank exceed the overall liquidity requirements…

The amount of cash held by an individual bank in excess of the usual requirement in its day-to-day operations. – Total by which banks’ balances with the central bank exceed the overall liquidity requirements…

The fact that in the developed economies the birth rate is decreasing with the consequence that – the share of people over 65 is increasing while – the growth of the working population is…

The fact that in the developed economies the birth rate is decreasing with the consequence that – the share of people over 65 is increasing while – the growth of the working population is…

A bank’s current account balances in excess of the reserve requirement (actual reserves above central-bank required reserves). – See reserve requirements, excess liquidity. – On the level of excess reserves, see the annex “Euro…

A bank’s current account balances in excess of the reserve requirement (actual reserves above central-bank required reserves). – See reserve requirements, excess liquidity. – On the level of excess reserves, see the annex “Euro…

In general, an organized market in which negotiable items are regularly traded in accordance with established practices. A distinction is made according to the object of the traded goods – securities exchanges or securities…

On the securities exchange, a committee that decides on the admission of a security to trading on the official market or regulated market. The admission requirements vary depending on the market segment. However, all…

In Germany, a detailed description of all important facts of a company applying for admission to listing on the official market; see § 30 et seq. of the Stock Exchange Act. BörsG. – See…

Bug-proofed workspaces on the exchange where members can receive orders, equipped with modern IT technology, which exchange members can use to connect with the exchange department of their own institution or directly with customers.…

Authority responsible for managing a country’s foreign exchange in the case of a compulsory foreign exchange economy. – See tender obligation, export premium, exposure quota, foreign exchange ceiling, foreign exchange allowance procedure, foreign exchange…

In Germany, this committee is part of the Federal Ministry of Finance and prepares or draws up recommendations for the supervisory authorities, in particular those that are close to the market. The current takeover…

The task of a securities exchange is – to bring together supply and demand = market function, – to provide an environment in which an orderly issue of securities can take place = mobilization…

In Germany, a body of the supreme state authority, the state government, which approves the establishment of an exchange, orders its possible closure and supervises the operation of the exchange. Supervision extends to compliance…

Unless otherwise defined, cross-border trade in services. It is recorded statistically as a separate item in the balance of payments and is also important for monetary policy. – However, the precise calculation of trade…

In principle, any company is free to make exchange offers to the holders of securities – such as shares, bonds, fund units or certificates – of another company. Custodian banks are also contractually obligated…