International Dictionary of Banking and Finance

John Clark

• Publisher: Routledge
• Year: 2013
• eBook ISBN: 9781135946616
• Topic: Business
• Subtopic: Business General
• Index: Business

Simple, concise, and up-to-date, the International Dictionary of Banking and Finance lists thousands of key words, terms, acronyms, and proper names that bankers, financial managers, students, and business teachers use every day. Arranged in alphabetical order, the terms are precisely defined--so that readers may comprehend the meanings in terms of daily business activities or study. Designed with the student as well as the executive in mind, the Dictionary includes terms and concepts from around the world, and it cross-references related terms to provide insight and clarification. Subjects covered include: investments; finance; commercial and mortgage banking; exporting; business structure; and a host of other broad business categories.

C

CA Abbreviation of chartered accountant.

cabinet crowd Members of the New York Stock Exchange who deal in rarely traded bonds.

cable transfer An alternative term for telegraphic transfer.

CAD Abbreviation for cash against documents.

call Act of demanding payment for shares or stocks, or repayment of a debt. A lender may advance money on condition that it is repayed on call (without notice).

callable bond Bond that may be called for payment before maturity date.

callable fixture Short-term (3-week to 3-month) loan made by a bank to a discount house. The bank thus has a secure deposit that earns interest, and the discount house has the use of funds for buying short-term bills or bonds. The loan is repayable on demand. See call money.

called-up capital Some of money that has been paid to a company by its shareholders. See also partly-paid shares; uncalled capital.

call money Type of loan made by a bank, which must be repaid upon demand. It is also known as money at call.

call option Option to by shares, commodities or financial futures at an agreed price on or before an agreed future date.

call over Method of trading on a stock exchange whereby the securities listed are called out in order, and dealers make bids or offers for each security according to their instructions.

call-over price Price for a security verbally agreed at call over.

call provision Condition attached to a bond by which the issuer is entitled to redeem the bond at a fixed price after a specified period of time.

call up Alternative term for call, especially with respect to partly-paid shares.

Calvo clause Contract clause regarding foreign investment. It states that, in the event of a dispute, the parties agree to abide by the law of the foreign country.

Canadian Bankers Association Originally formed as a voluntary association in 1890, this bankers’ association is unique in that it was specifically chartered by act of the Canadian Parliament in 1900 (amendment to the Canadian Banking Act) to effect greater cooperation among Canadian banks in the issuance of notes, in credit and control, and in various other aspects of bank activity.

cancellation Voiding of an agreement, either in due course (such as the discharge of a bill of exchange or the payment of a cheque) or by defacement or mutilation of a document.

cancellation price Lowest price a unit trust manager can accept for units on any one day, as formulated by the Securities and Investment Board.

C & F Abbreviation of cost and freight.

CAP Abbreviation of Common Agricultural Policy.

cap Interest rate option that enables the investor to hedge against the possibility of interest rates rising to the investor’s disadvantage. See hedging.

capacity Measurement of the ability of a company to produce goods or services.

cap and collar mortgage Mortgage with fixed upper and lower limits of the variable interest rate.

capital Vague term that most often requires a qualification. Unqualified, it usually refers to the resources of an organization or person (e.g. equipment, skill, cash).

capital account Part of the balance of payments, which refers to international movements of capital, including intergovernmental loans.

capital adequacy Legal requirement that a financial institution (such as a bank) should have enough capital to meet all its obligations and fund the services it offers.

capital allowances Amounts deducted from a company’s profits before tax is calculated, to take into account depreciation of capital assets (such as vehicles, plant and machinery, and industrial buildings).

capital assets Another term for fixed assets.

capital bond Full name National Savings Capital Bond.

capital budget Forward planning of forward capital movement, involving larger sums of money and longer timescales than a cash budget.

capital clause In the memorandum of association of a company, that section setting out the details of the company’s capital.

capital duty Former tax paid by companies on profits from new share issues. It ceased to be levied in 1988.

capital employed Capital that a company uses to finance its assets. It is taken to be the sum of shareholders’ funds, loans and deferred taxation.

capital expenditure Expenditure on capital goods, e.g. fixed assets such as plant or on trade investments and current assets. Capital expenditure is classed as below-the-line for accounting purposes. See also trade investment.

capital gain Gain made from a capital transaction, e.g. the buying and selling of assets.

capital gains tax (CGT) Tax paid on capital gains.

capital goods Goods (such as machines) that are used for the production of other goods. Ships are also sometimes regarded as capital goods.

capital growth Increase in the value of an investment over a period of time.

capital guarantee investment Investment, such as those in National Savings, that cannot fall in value (because of a guarantee given by a bank, building society, government or other institution).

capital-intensive Describing a business in which capital is the most important and costly factor of production. Thus, an industry in which the major cost is the purchase and maintenance of machinery (fixed assets) is capital-intensive.

capitalism Economic and political system in which people are entitled to trade for profit on their own account. It is also known as free or private enterprise. See also communism.

capitalist economy Economy in which business is conducted for the profit of the companies and persons engaged in it.

capitalization Term with two meanings:

1. It is the conversion of a company’s reserves into share capital by issuing more shares.

2. It is the total amount of capital available to a company in the long term.

capitalization issue Alternative term for bonus issue.

capital/labour ratio Proportion of capital to labour used in an economy.

capital market Market made up of the various sources of capital for (medium- or long-term) investment in new and already existing companies. In the UK it is centred on the London Stock Exchange and the Alternative Investment Market (AIM).

capital outlay Expenditure on fixed assets such as machinery. See also capital.

capital profit Profit generated by selling capital goods (fixed assets), rather than by trading.

capital reserves Profits from a company’s trading that represent part of the company’s capital and so may not be repaid to shareholders until the company is wound up.

capital saturation Situation in a company or industry in which there is such a proportion of capital to labour that any increase in capital would have no significant positive effect on output.

capital stock Value of all capital goods owned by a company, industry or nation, after depreciation has been taken into account.

capital transfer tax (CTT) Tax paid on the transfer of capital, e.g. in the form of a gift or bequest. Capital transfer tax covers the former inheritance tax.

capped mortgage Mortgage with a fixed upper limit to its variable interest rate.

captive fund Fund for ventu...

Table of contents

• Cover
• Title Page
• Copyright Page
• Table of Contents
• Preface
• John O E Clark
• A
• B
• C
• D
• E
• F
• G
• H
• I
• J
• K
• L
• M
• N
• O
• P
• Q
• R
• S
• T
• U
• V
• W
• X
• Y
• Z