English

Futures trading on the commodity exchange does not exist for all products, for example currently not for germanium (germanium: a scarce, metallic, greyish-white element, normally tetravalent, used chiefly in transistors). Therefore, a futures contract…

Term from options trading. When a hedger takes a long position in the cash market – for example, he holds a grain stock or he has grown grain – he hedges with a short…

Generally, the place where market participants trade short-term liquidity for collateral. – See General collateral repos, Repo business. – Cf. Deutsche Bundesbank Monthly Report January 2014, p. 73 f. (Outlook: Growing importance of repo…

Repurchase agreement in securities transactions – i.e. a sale with simultaneous forward repurchase -, usually relating to transactions between central banks and commercial banks. – The repurchase price comprises the purchase price and interest…

The forward price of a foreign exchange is higher than the spot rate (day’s rate; daily rate). – Sometimes also referred to as the price of an option, paid by the buyer of an…

Banks in Germany are obliged to report to the Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht) if EX ANTE or EX POST there are indications that transactions violate the prohibition of insider transactions or…

Banks in Germany are obliged to report to the Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht) if EX ANTE or EX POST there are indications that transactions violate the prohibition of insider transactions or…

Reporting by a company on the course of business. – Reporting of trades in securities traded on the stock exchange. Most stock exchanges have a strict reporting obligation for all market segments. – Information…

Under IAS/IFRS, the monetary unit in which (annual) financial statements are prepared. – See reporting currency, currency, functional. Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes…

Generally, regulators require commodity and securities exchanges to report open positions above a certain level. – See Aggregation, Commodity Futures Trading Commission, Positions, reportable. Attention: The financial encyclopedia is protected by copyright and may…

Unless otherwise defined, the legal requirement for an institution to provide information to the supervisory authority on an ongoing basis or at its request. The positions subject to disclosure requirements are specified by the…

Unless otherwise defined, this means the automatic intergovernmental exchange of information on interest payments made within the European Union and in the so-called dependent and associated territories, namely Channel Islands (Jersey, Guernsey, Isle of…

Obligation of institutions to provide the supervisory authority with the required information in a timely and complete manner. – See Banking supervision, European, Reporting threshold, Public disclosure. – Cf. BaFin Annual Report 2006, p.…

Regulations on reporting by institutions enacted by the Federal Financial Supervisory Authority at the end of 2006. – Cf. BaFin Annual Report 2006, p. 118 f. (details on the AnzV). Attention: The financial encyclopedia…

In the financial market, an office established by a bank in a foreign country where a branch office or subsidiary does not seem advisable. – The supervisory authorities pay particular attention to such establishments.…

In a narrower sense, this refers to coercive measures by which states keep their financing costs low without having to resort to spending cuts and thus violate Constitutional Article One. The measures – usually…

In the issuance of securities, the excess of the sum of the amounts subscribed over the total amount offered; in this case, it usually causes rationing, a limited allocation. – The allocation of the…

An agreement under which – an asset is sold, – but at the same time the seller is entitled and obligated to – repurchase the asset at a specified price on a given date…

Generally, any temporary exchange of assets for money, a repo. – The purchase of an asset with a simultaneous agreement to repurchase it at a later, contractually specified date. – The central bank –…

In the central bank’s balance sheet, a repurchase agreement is recorded as collateralized borrowing on the liabilities side of the balance sheet. On the assets side, the assets serving as collateral are posted. A…

Generally, the purchase of an asset with the simultaneous agreement to sell items of the same type and amount to the counterparty at a later date. – In particular, the transfer of securities in…

Date on which the buyer is obliged to sell back assets to the seller under a repurchase agreement. Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes…

Generally, a contract under which one party receives cash from a counterparty in exchange for the deposit of collateral for a fixed period of time. The rights arising from the deposited collateral – usually…

Price at which the buyer is obliged to sell assets to the seller under a repurchase agreement. – The repurchase price is usually equal to the sum of the purchase price and the price…

In the case of an issue, the clause that the paper may not be called for redemption (repayment) by the issuer within a certain period (a clause in a paper and especially in a…

Unless otherwise defined, in the older literature, the acceptance of fixed-income securities at a fixed price on the last day of a month in which trading takes place in exchange for their return at…

The good name, reputation, creditworthiness, credit standing of an actor in the financial market. – See ring fencing, overconfidence, trust. Attention: The financial encyclopedia is protected by copyright and may only be used for…

Risk that a bank and, in general, a company may suffer a loss of confidence among business partners and customers as a result of incorrect behavior on the part of individuals, groups or special…

At the ECB, the amount of minimum reserves required to be held by each institution is first calculated by applying to the amount of liabilities subject to reserve requirements the reserve ratio of the…

In older documents, a written order to pay out a sum of money, a payment order (payment or). – Today, especially in Switzerland, a common term for a federal treasury note or a cantonal…

With regard to the ECB’s outright monetary policy operations – the OMT program: the purchase of government bonds of weakening EMU members in order to support them: this undermines the disciplinary pressure of the…

A loan from the public sector to maintain the liquidity of a company in the short term; usually limited to six months and with the purpose of being able to draw up a plan…

Derisive media term for EMU members that emerged in 2011 in connection with the high sovereign debt of EMU member states that came to light and the subsequent bailouts. – See blackmail potential, European…

A term that emerged in the financial world in 2008, meaning that the state comes to the aid of failing banks. – The rescue packages put in place by the governments of individual countries…

At a bank, usually a separate department “devoted to deliberate search or investigation with the aim of achieving new knowledge and in the hope that such knowledge will be useful in developing new products,…

Body of the ECB that coordinates in-house research activities and awards corresponding external contracts. – See Absorptive Capacity, Research, Research Network on Inflation Persistence and Pricing Behavior, Money Burning, International Monetary Policy Research Forum.…

a body established in 2003 and operating until 2005, in which the economics departments of central banks in the euro area contributed, exchanged and comparatively assessed the results of their respective analyses. – See…

In the case of banks, the financing of scientific research into individual business areas or new developments in the financial market by public or private institutions, usually university institutes. Credit Suisse, for example, has…

In a company, the relation between research expenditure and sales. In high-tech industries, this ratio can exceed twenty percent. The research quota sometimes plays a decisive role in bank lending to these companies. –…

Unless otherwise defined, in the financial sphere this is generally understood to mean accumulated cash that is used for a special purpose at a later time (money that is stored so that it can…

Account with the central bank on which a counterparty maintains reserve assets. Counterparties’ settlement accounts with the national central banks may be used as reserve accounts. Attention: The financial encyclopedia is protected by copyright…

Unless otherwise defined, a short-term loan granted by a central bank to public sector entities to bridge liquidity shortages in the course of budget execution. – In the European monetary union, such loans by…

the sum of the items of the balance sheet used by the central bank to calculate the reserve requirement of a credit institution. – For the individual balance sheet items, see the annex entitled…

Amounts of central bank money held by banks in excess of their daily cash requirements at retail (opening hours) in order to eliminate the risk of temporary illiquidity. – See contingent cash, liquidity, liquidity…

Globally valued money – such as the CHF, EUR and USD in particular at present – which central banks prefer to hold in reserve for emergencies, in addition to gold. – See currency reserves.…

Balances held by counterparties on their reserve accounts with the ECB in order to fulfill reserve requirements. The amount of these holdings is shown under the heading “Monetary statistics” in the “Euro area statistics”…

Rate set by the central bank for each category of balance sheet items subject to reserve requirements. The rates are used to calculate the reserve ratio. – See the reserve ratios in the annex…

Obligation of banks to hold minimum reserves with the central bank. – In the ECB’s minimum reserve system, the amount of minimum reserves to be held by an institution (reserve requirement) is calculated by…

At the ECB, the aggregate balance of banks’ accounts with the central bank that exceeds the reserve requirement, calculated on a given day. – See reserve assets. – Cf. ECB Monthly Bulletin, January 2008,…

Generally, surpluses from economic activity that are held for specific future purposes. – See accruals. Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes without express consent!…

Segment of the securitization market in which various mortgage loans or bonds collateralized by private residential properties are brought together in a pool (asset-backed securities which are collateralized by a portfolio of residential properties).…

The one-time payment to a builder who – creates owner-occupied housing or provides such housing through his construction activity – in house building, in housing development – constructs factory buildings that bring new permanent…

Economic agents who are permanently resident in a country or currency area. Central banks usually distinguish between deposits of residents and deposits of non-residents in reserve requirements – see foreign exchange management, foreign currency…

Uncertainty that remains in relation to financial markets and cannot be eliminated by appropriate hedging strategies such as hedge transactions (exposure to loss remaining after other identified risks have been eliminated, hedged, factored in,…

The balance of remaining debt that declines with each payment. See settlement, payment, collection, due date, receivable, prepayment, target. Attention: The financial encyclopedia is protected by copyright and may only be used for private…

A term frequently used in older literature to refer to – a sum still outstanding for payment, as well as – citizens and companies that have not yet fulfilled their tax obligations. Attention: The…

Body established as part of the Single Resolution Mechanism. In the event of a bank failure, the resolution authority ensures the orderly restructuring or liquidation of the institution concerned across national borders. As with…

Term incorporated into regulatory language after 2010. It refers to the precautions taken in the event that a systemic bank becomes distressed. In principle, resolution should take place in such a way that –…

A grace period (respite) for late payment by the debtor, generally without legal consequences (without consequences of default). – See money forgiven, grace period, respect days, default, arrears. Attention: The financial encyclopedia is protected…

In jargon, for times when there is little or no work to be done and, especially in the front office, no customers are coming in. Especially at the cash counter (bank counter of the…

In the pursuit of compliance, a procedure whereby all transactions in certain securities are prohibited; unless these are based exclusively on clear, documented customer instructions. This is recommended and in some cases required by…

In the pursuit of compliance, a procedure whereby all transactions in certain securities are prohibited; unless these are based exclusively on clear, documented customer instructions. This is recommended and in some cases required by…

If an analyst is also employed in other departments of an institution, there is a risk that his or her independence and neutrality will be compromised. The supervisory authority considers such a risk to…

A central bank’s announced intention to tighten the money supply in several discrete steps and through various channels. – See briefcase indicator, forward guidance, guidance, verbal, signaling, stealth policy, fuzziness, constructive. Attention: The financial…

Unless otherwise defined, the recovery of a distressed company (stricken enterprise) through financial, managerial, and market measures. – See bankruptcy, extensum, insolvency, insolvency costs, management buyin, distress, financial, restructuring, ruin, debt restructuring, Vulture Fund,…

In the wake of the financial crisis that followed the subprime crisis, a demand was made that a systemically important bank be placed under the compulsory control of the supervisory authority immediately if it…

Unless otherwise defined, this refers to a special business of private equity funds. – Ailing, insolvent companies that have usually already been abandoned by the banks are provided with equity capital from the fund’s…

Capital stock introduced by the Restructuring Act into which the bank levy flows. The fund is managed by the Financial Market Stabilization Agency (Finanzmarktstabilisierungsanstalt) and is subject to the supervision of the Federal Ministry…

Act that came into force at the beginning of 2011 (officially: “Act on the Restructuring and Orderly Liquidation of Credit Institutions, on the Establishment of a Restructuring Fund for Credit Institutions and on the…

Unless otherwise defined, synonymous with outcome: the profit or loss from an economic activity. – See contribution margin, result, yield, profit, run rate, surplus, lemon trade. Attention: The financial encyclopedia is protected by copyright…

All transactions of a bank with the mass of private households. This also includes corporate loans to small business owners and craftsmen. – Although the customer-oriented retail business is considered to be particularly cost-intensive…

Another term for a bank’s retail business. – See retail business. Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes without express consent! University Professor Dr. Gerhard…

Procedures for facilitating non-cash payment transactions of – comparatively small in amount but – very frequent and – large in volume. – See EFTPOS, Capital transfer system, electronic, Contact group on strategic issues in…

According to Article 127 TFEU (Lisbon Treaty 2009), the ECB must ensure the smooth operation of payment systems. This is done primarily through the TARGET system. – In August 2014, the ECB issued a…

Both the actual value of products sold in the retail trade (CH: retail trade) and the expected amounts are monitored by the central bank in the course of its forecasting of possible changes in…

Following the subprime crisis in the summer of 2007, which escalated into a global financial crisis in the fall of 2008, the regulatory authorities required originating banks to retain a certain percentage of the…

Following the subprime crisis in the summer of 2007, which escalated into a global financial crisis in the fall of 2008, the supervisory authorities required originating banks to retain a certain percentage of the…

Another term for a non-performing loan, namely a loan with the sole purpose of improving the balance sheet structure (to retouch = to correct in order to get a more desirable appearance). – See…

In the case of securitizations, the contractual agreement that securities whose servicing falters within the first few months can be returned to the special purpose entity or the originator. As a result, – buyers…

The quotations – for one security on the stock exchange or – the prices of all securities – suddenly fall back after a period of upward trend; – however, they follow the previous course…

In general, the transfer of risks assumed by an insurance company to contracting parties (retrocessionaires) in return for an agreed premium. – In particular, the securitization of risks assumed by a reinsurer. In this…

Expression chosen as “Word of the Year 2012” in Germany. It combines – linguistically unusually – two contradictory terms and is intended to express that the constantly recurring measures to stabilize highly indebted EMU…

Unless otherwise defined, the view that Germany should leave EMU and – either return to its old currency, namely the German mark that circulated until 2002 – or introduce its own money together with…

Ratio of the pre-tax profit generated during a period (yield before taxes) to the balance sheet equity of a company (net earnings of a company divided by its assets; it measures how economically and…

Return on Investment (ROI) is a financial metric used to measure the probability of gaining a return from an investment. It is a ratio that compares the gain or loss from an investment relative…

Unless explicitly defined otherwise, this is the ratio of profit before taxes to sales within an accounting period. It thus indicates how many GE of profit a company has generated per GE of sales.…

Unless explicitly defined otherwise, this is the ratio of profit before taxes to sales within an accounting period. It thus indicates how many GE of profit a company has generated per GE of sales.…

In older financial language, a bill of exchange returned for lack of acceptance or for lack of payment to the preceding endorser. Attention: The financial encyclopedia is protected by copyright and may only be…

The official reassessment of the comparative value of a currency – upwards – in relation to an underlying benchmark, such as gold, USD, Special Drawing Right or a basket of currencies. – This is…

If the exchange rate of a currency, e.g. the EUR, rises against another currency such as the USD, the INR, this results in unfavorable and favorable effects for the currency area affected by the…

Global investor demand is directed toward securities denominated in a particular currency, the conservation of value and purchasing power of which is trusted. As a result, the currency in question becomes expensive and the…

Comparison of an open position on the futures market with the current market price. – Open forward positions are continuously compared by banks or stockbrokers with the current market price in order to –…

Unless otherwise defined, the amount of money a company receives from the sale of goods on the market; the product of sales volume and sales price (turnover) from the core business. – Cash inflows…

Unless otherwise defined, the executive activity of the fiscal authority. – Often, the public financial service is divided into the – instruction system, – payment system (cash system) and- official accounting system including auditing,…

Revenue Growth is a financial metric that measures the increase (or decrease) in a company’s sales from one period to another. It’s expressed as a percentage and indicates the rate at which a company’s…

Generally, any inflow of – money (narrower term) or – assets (broader term; usually then, however, restricted to easily liquidated assets, such as a gold bar or precious stones) at an economic unit (private…

In the case of real estate funds, the inflow of funds through the issue of new share certificates less the outflow of funds through the redemption of share certificates. – In the ECB’s Monthly…

The revenue of the government in relation to the gross domestic product. and determined according to certain rules of national accounting – here mainly taxes, inflows from regalia and concessions, property income, charges, investment…

The inflow of money for a good (product or service) that has not yet been delivered to the customer (revenue received before a product is sold or a service is provided). Examples are a…

If not defined otherwise, one of the ways to hedge risks from an interest rate swap. In this case, the bank concludes a second offsetting interest rate swap – usually with another partner –…