The terms used in banking business such as Repressed Inflation,Rate of Return,Reconciliation,Recurring Deposits etc.
This post explains about terms used in banking such as Repressed Inflation,Rate of Return,Reconciliation,Recurring Deposits ,Redemption Price,Refinancing,Regular Savings account,Refunding,Renewal,Rescheduling of Payment 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
Rate of Return: The yield that can be attained on a security, based on its purchase price or its current market price. On a bond,the rate of return may be the amortized yield to maturity or the current income return. Also refers to income earned on an investment, expressed as a percentage of the cost of the investment.
Rating: Refers to the credit quality of a counterparty. External ratings are given by rating agencies (ranging from AAA very safe asset to C). Internal ratings are granted by the bank itself.
Ratio: Comparison of two figures used to evaluate business performances, such as debt/equity ratio return on investment, etc.
RBI: The Reserve Bank of India is the apex bank of the country, which was constituted under the RBI Act, 1934 to regulate the other banks, issue of bank notes and maintenance of reserves with a view to securing the monetary stability in India.
Real Interest Rate: The net interest rate over the inflation rate. The growth rate of purchasing power derived from an investment.
Realized Gain/Loss: Actual profit or loss experienced upon the sale of a security. Compare Paper Gain/Loss.
Receiving Bank: The bank where the beneficiary account is held.
Reconciliation: Checking all bank account papers to make sure that the bank’s records and customer’s records are in sync.
Reconverting Bank:1) The Bank that creates a substitute check; or 2) If a substitute check is created by a person other than a Bank, the first Bank that transfers or presents that substitute check.
Recourse: In the context of a sale of a loan by a bank to investors, they have the right to call the guarantee from the bank should the borrower be unable to meet its obligations.
Recurring Deposits – These are also called cumulative deposits and in recurring deposit accounts, a certain amounts of savings are required to be compulsorily deposited at specific intervals for a specified period.
Redemption Fund: A fund created for the purpose of retiring a callable obligation that matures in stages or for purchasing such an obligation as funds become available.
Redemption Price: The price at which a bond may be redeemed, at the issuer's option, before maturity.
Redemption Value: The value of a bond when redeemed.
Redemption: Redemption means paying off all the money borrowed under an agreement.
Redemption: Liquidating debt by retiring an outstanding obligation. This may occur at maturity but usually occurs at the issuer's option, such as when a bond issue is retired before its maturity date.
refinance -- To revise a loan agreement to make the terms of payment more suitable to a borrower's present income and ability to repay. Refinancing usually provides a lower interest rate and lower monthly payments over a longer period of time.
Refinancing: Rolling over the principal on securities that have reached maturity or replacing them with the sale of new issues.The object may be to save interest costs or to extend the maturity of the loan. See Refunding.
Reflation: It signifies general increase in the level of business activity in the economy. Reflation generally involves greater government expenditure and the easing of credit to encourage increased production.
Refunding: Replacing an outstanding obligation on or before its maturity with a new issue in order to extend the length of the borrowing, change the interest rate, consolidate issues, or postpone payment until a more opportune time.
Registered Bond: A bond whose principal and/or interest is payable only to the person or organization registered with the issuer.This bond can be transferred only when endorsed by the registered owner.
Registered Education Savings Plan (RESP): A government registered savings or investment account that allows money to be set aside for your child's post-secondary education (such as university or college). Investment income and capital gains earned within RESPs are not subject to tax until money is withdrawn, at the student's typically lower tax rate.
Regressive Tax: It is a tax in which rate of taxation falls with an increase in income. In regressive taxation incidence falls more on people having lower incomes than that of those having higher incomes.
Regular Savings account: A deposit account which pays interest, but does not allow funds to be withdrawn by writing a check.
Regular-Way Delivery: Unless otherwise specified, most government securities sold are to be delivered and paid for on the business day following the transaction. Regular delivery for municipal and corporate securities, however, is three business days.
Regulation E: Regulation E carries out the purposes of the Electronic Fund Transfer Act, which establishes the basic rights, liabilities, and responsibilities of consumers who use electronic fund transfer services and of financial institutions that offer these services. The primary objective of the act and Regulation E is the protection of individual consumers engaging in electronic fund transfers.Electronic fund transfer systems include automated teller machine transfers, telephone bill-payment services, point-of-sale (POS) terminal transfers in stores, and preauthorized transfers from or to a consumer’s account (such as direct deposit and social security payments). The term “electronic fund transfer” (EFT) generally refers to a transaction initiated through an electronic terminal, telephone, computer, or magnetic tape that instructs a financial institution either to credit or to debit a consumer’s asset account.
Reinvestment Value: The rate at which an investor assumes interest payments made on a bond which can be reinvested over the life of that security.
Relative Strength Index (RSI): A stock’s price that changes over a period of time relative to that of a market index such as the Standard & Poor’s 500, usually measured on a scale from 1 to 100, 1 being the worst and 100 being the best.
Remote Check Capture: Electronically transmits check images and deposits to a bank for processing and clearing .
Renewal: At the end of your loan term you may need to extend the length of your loan. If the loan is extended, the loan is "carried over" or renewed. Similarly, if you have a term deposit, the deposit may be "carried over" or renewed at maturity.
Repetitive Transfer: Repeated electronic funds transfers in which the credit parties and transaction description remain the same and only the amount and date of the transfer changes.
Repo Rate: Commercial banks borrow funds by the RBI if there is any shortage in the form of rupees. If this rate increases it becomes expensive to borrow money from RBI and vice versa.
Repressed Inflation: It is a state in which aggregate demand is greater than the total supply of goods and services in an economy, but prices are prevented from rising to eliminate excess demand. The holding down of price is sometimes done by government as a means of suppressing inflation.
Repurchase Agreement: An arrangement in which a security is sold and later bought back at an agreed price and time.
Rescheduling of Payment: Rearranging the repayment of a debt over a longer period than originally agreed upon due to financial difficulties of the borrower.
Reserve Asset Ratio: It is the ratio of a bank’s reserve assets to its eligible liabilities.
Resistance Level: A price at which sellers consistently outnumber buyers, preventing further price rises.
Resolution: A formal document expressing the intention of a board of directors of a corporation.
The above details describes about terms called in banking such as Repressed Inflation,Rate of Return,Reconciliation,Recurring Deposits ,Redemption Price,Refinancing,Regular Savings account,Refunding,Renewal,Rescheduling of Payment 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 Product Life Cycle,Productivity,proprietary credit card,Prospectus etc
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