Terms used in banking business such as Loan Documen,Lock-out,London Interbank Offered Rate,Lorentz Curve etc

 

The terms used in banking business such as Loan Documen,Lock-out,London Interbank Offered Rate,Lorentz Curve etc.

 

 

This post explains about terms used in banking such as Leverage Ratio,Leveraged buy out,Libor,Limited Company,Liquid Assets,Liquidity Ratio,Liquidity,Listed Securities,Loan Documen,Lock-out,London Interbank Offered Rate,Lorentz Curve etc. These terms used in international business are arranged in alphabetical order and you may add more information about terms used in export business at the end of this article, if you wish.

 

The terms used in banking business

 

Letter of Credit: A document issued by importers bank to its branch or agent abroad authorizing the payment of a specified sum to a person named in Letter of Credit (usually exporter from abroad). Letters of Credit are covered by rules framed under Uniform Customs and Practices of Documentary Credits framed by International Chamber of Commerce in Paris.

 

Leverage Ratio: Financial ratios that measure the amount of debt being used to support operations and the ability of the firm to service its debt.

 

Leverage:Ratio of assets to capital.

 

The terms used in banking  business such as Loan Documen,Lock-out,London Interbank Offered Rate,Lorentz Curve etcLeveraged buy out (LBO): takeover of a company funded by high-risk bonds or loans.

 

Leveraging: using debt to supplement investment. An institution that has borrowed heavily in addition to its funds or equity to finance growth is said to be highly leveraged.

 

Liability: A legal responsibility you have for something. For instance, a debt you owe is considered a liability. Also, if you damage property or injure a person, you may have to take financial responsibility.

 

Libor: The London Interbank Offered Rate (or LIBOR) is a daily reference rate based on the interest rates at which banks offer to lend unsecured funds to other banks in the London wholesale money market (or interbank market). The LIBOR rate is published daily by the British Banker’s Association and will be slightly higher than the London Interbank Bid Rate (LIBID), the rate at which banks are prepared to accept

 

Lien: A lender’s claim on assets offered as security for a loan.

 

Life Expectancy at Birth: The number of years a newborn infant would live if prevailing pattern of age specific mortality rates at the time of birth were to stay the same throughout the child’s life.

 

Limit Order: An order to buy (sell) securities which specifies the highest (lowest) price at which the order is to be transacted.

 

Limited Companies Accounts: Accounts of companies incorporated under the Companies Act, 1956 . A company may be private or public. Liability of the shareholders of a company is generally limited to the face value of shares held by them.

 

Limited Company: The passive investors in a partnership, who supply most of the capital and have liability limited to the amount of their capital contributions.

 

Limited Order: An order to buy or sell a certain amount of a security at a minimum price within a specific period of time.

 

Limited-Tax Bond: A bond guaranteed by a special tax or taxes, or by a specified portion of the real estate tax. The rate and amount of such a bond is limited.

 

Line of Credit: A pre-approved credit facility (usually for one year) enabling a bank customer to borrow up to the specified maximum amount at any time during the relevant period of time.

 

Linked account:Any account linked to another account at the same financial institution so that funds can be transferred electronically between accounts. In some cases, the combined balance of all linked accounts may determine whether monthly maintenance and other fees are applied to the account.

 

Liquid Assets:Liquid assets consists of: cash, balances with RBI, balances in current accounts with banks, money at call and short notice, inter-bank placements due within 30 days and securities under "held for trading" and "available for sale" categories excluding securities that do not have ready market.

 

Liquidation: It refers to the termination (or winding up) of a registered company. Liquidation takes place because of company's insolvency. In liquidation, assets are turned into cash for settling outstanding debts and for apportioning the balance, if any, amongst the owners.

 

Liquidity Ratio: The commercial banks under banking regulations have to maintain a certain specified proportion of their total deposits of various categories in liquid assets. This maintainable proportion is called liquidity ratio.

 

Liquidity: The extent to which or the ease with which an asset may quickly be converted into cash with the least administrative and other costs.

 

Liquidity: Assets which can easily be converted into cash money are said to have liquidity. Land does not possess liquidity at it takes longer time to get converted into cash.

 

Liquidity: It is the ability of converting an investment quickly into cash with no loss in value.

 

Liquidity: The ease at which a security can be bought or sold (converted to cash) in the market. A large number of buyers and sellers and a high volume of trading activity are important components of liquidity.

 

Listed Securities: Securities that have been admitted for trading on a recognized securities exchange. Unlisted securities are usually sold over the counter.

 

Listing Date: The date on which Initial Public Offering stocks are first traded on the stock exchange by the public

 

Listing: Quotation of the Initial Public Offering company’s shares on the stock exchange for public trading.

 

Loan - A loan is a type of debt. In a loan, the borrower initially receives or borrows an amount of money, called the principal, from the lender, and is obligated to pay back or repay an equal amount of money to the lender at a later time. There are different kinds of loan such as the house loan, auto loan etc.

 

Loan Document: A business contract by which a borrower and lender enter into an agreement. Loans are classified according to the lender or borrower involved, whether or not collateral is required, the time of maturity,conditions of repayment, and other variables.

 

Loan Risk: This is the risk of loss from loaning money and having the borrower fail to repay, either due to genuine reasons or willfully.

 

Loan: An amount of money you borrow from a financial institution. You are charged interest on the amount you borrow. The amount borrowed and interest owed must be paid back in a fixed amount of time.

 

Lockbox: A banking service in which payments or deposits are collected by the bank at a postal or drop box, and then processed by a special department in the bank.

 

Locked Market: A securities market in which the bid price is the same as the asked price.

 

Lock-out: Lock-out refers to such a situation when the management does not permit the workers to work unless they agree to accept the employer's term. Lock-out is the closing of work by the management for an uncertain period of time to put pressure on the labour union. It is an action by the employer equivalent to a strike by employees.

 

London Interbank Offered Rate (LIBOR): The interest rate on Eurodollar deposits traded between banks. The rate depends on the maturity of the deposit as well as on which bank quotes the rate.

 

Long: Owning more securities than one has contracted to deliver.

 

Long-term Liabilities:Money that one owes over a period longer than 12 months, such as mortgages, bank loans and other obligations.

 

Lorentz Curve: This curve shows the degree of inequalities of a frequency distribution in a graphical manner. It is a curve on a graph which shows the cumulative proportion of a statistical population against this cumulative share of some characteristic. This curve is commonly used to depict income distribution showing the cumulative percentage of people from the poorest up and their cumulative share of national income.

 

Loss Asset: A loss asset is one where loss has been identified by the bank or internal or external auditors or the RBI inspection but the amount has not been written off wholly. In other words, such an asset is considered uncollectible and of such little value that its continuance as a bankable asset is not warranted although there may be some salvage or recovery value.

 

The above details describes about terms called in banking such as Leverage Ratio,Leveraged buy out ,Libor,Limited Company,Liquid Assets,Liquidity Ratio,Liquidity,Listed Securities,Loan Documen,Lock-out,London Interbank Offered Rate,Lorentz Curve etc. These phrases may help importers and exporters on their day to day business activities. The readers can also add more information about terms used in overseas trade below this post.Terms used in banking business such as Law of Limitation,Laissez Faire,KYC Norms,Legal Opinion,Legend,Joint Sector etc

 

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