Super Finance Glossary

Finance

Over 10,000 financial glossary terms...

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Asset Swap
Definition: An interest rate swap used to alter the cash flow characteristics of an institution's assets in order to provide a better match with its liabilities.
Asset Turnover
Definition: The ratio of net sales to total assets.
Asset Valuation Review
Definition: A review of all of a failing institution's assets to estimate the liquidation value of the assets. This estimate is used in the least cost analysis that is required by Federal Deposit Insurance Corporation Improvement Act (FDICIA) of 1991.
Asset Value
Definition: The net market value of a corporation's assets on a per-share basis, not the market value of the shares. A company is undervalued in the market when asset value exceeds market value.
Asset-backed Security
Definition: A security that is collateralized by loans, leases, receivables, or installment contracts on personal property, not real estate.
Asset-based Financing
Definition: Methods of financing in which lenders and equity investors look principally to the cash flow from a particular asset or set of assets for a return on, and the return of, their financing.
Asset-coverage Test
Definition: A bond indenture restriction that permits additional borrowing if the ratio of assets to debt does not fall below a specified minimum.
Asset/equity Ratio
Definition: The ratio of total assets to stockholder equity.
Asset/liability Management
Definition: The task of managing the funds of a financial institution to accomplish two goals: (1) to earn an adequate return on funds invested and (2) to maintain a comfortable surplus of assets beyond liabilities. Also called surplus management.
Assets
Definition: A firm's productive resources.
Assets Requirements
Definition: A common element of a financial plan that describes projected capital spending and the proposed uses of net working capital.
Assets-in-place
Definition: Property in which a firm has already invested.
Assignable Contract
Definition: A contract that allows the holder to convey his rights to a third party. Exchange-traded contracts are not assignable.
Assignment
Definition: The receipt of an exercise notice by an options writer that requires the writer to sell (in the case of a call) or purchase (in the case of a put) the underlying security at the specified strike price.
Assignment Of Proceeds
Definition: Arrangement that allows the original beneficiary of a letter of credit to pledge or turn over proceeds to another, typically end supplier.
Assimilation
Definition: The public absorption of a new issue of stocks once the stock has been completely sold by underwriter. See: Absorbed.
Assistance Agreement
Definition: An agreement pertaining to a failing institution under which a deposit insurer, such as the FDIC, provides financial assistance to the failing institution or to an acquiring institution. The assistance agreement includes the terms of the purchase of assets and assumption of liabilities of the failing institution by the assuming institution; it may also include provisions regarding a reorganization of the failing institution under new management or a merger of the failing institution into a healthy institution.
Assisted Merger
Definition: A failing institution is absorbed into an acquiring institution that receives FDIC assistance. In 1950, the FDIC was authorized by section 13(e) of the Federal Deposit Insurance Act (FDI Act) of 1950 to implement assisted mergers. In 1982, when the FDI Act was amended, the merger authority, as amended, was written into section 13(c) of the FDI Act. Such transactions allow the FDIC to take direct action to reduce or avert a loss to the deposit insurance fund and to arrange the merger of a troubled institution with a healthy FDIC insured institution without closing the failing institution. Assisted mergers were the Federal Savings and Loan Insurance Corporation's preferred resolution method.
Associated Person (AP)
Definition: An individual who solicits or accepts (other than in a clerical capacity) orders, discretionary accounts, or participation in a commodity pool, or supervises any individual so engaged, on behalf of a Futures Commission Merchant, an Introducing Broker, a Commodity Trading Advisor, a Commodity Pool Operator, or an Agricultural Trade Option Merchant.
Association Of Southeast Asian Nations (ASEAN)
Definition: A loose economic and geopolitical affiliation that includes Singapore, Brunei, Malaysia, Thailand, the Philippines, Indonesia, and Vietnam. Future members are likely to include Burma, Laos, and Cambodia.
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