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Corporate Trust
In the most basic sense of the term, a corporate trust is a trust created by a corporation. The term in the United States is most often used to describe the business activities of many financial services companies and banks that act in a fiduciary capacity for investors in a particular security (i.e. stock investors or bond investors). For example, instead of borrowing funds from a bank, a company might borrow funds from the general public in the form of a bond. When a bank lends money to a company, it may often inspect the company's financial statements to ensure that the company follows the rules (known as covenants) of the loan agreement, and may also attempt to negotiate a settlement if the company has problems and stops repaying its loan. In the situation of a public bond issuance (the company borrowing from anyone in the general public who chooses to lend the funds), there would be no one clear person who would be capable to monitor the loans on their own, and the inves ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Trust Law
A trust is a legal relationship in which the owner of property, or any transferable right, gives it to another to manage and use solely for the benefit of a designated person. In the English common law, the party who entrusts the property is known as the "settlor", the party to whom it is entrusted is known as the "trustee", the party for whose benefit the property is entrusted is known as the "beneficiary", and the entrusted property is known as the "corpus" or "trust property". A ''testamentary trust'' is an irrevocable trust established and funded pursuant to the terms of a deceased person's will. An inter vivos trust is a trust created during the settlor's life. The trustee is the legal owner of the assets held in trust on behalf of the trust and its beneficiaries. The beneficiaries are equitable owners of the trust property. Trustees have a fiduciary duty to manage the trust for the benefit of the equitable owners. Trustees must provide regular accountings of trust income ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Debt
Debt is an obligation that requires one party, the debtor, to pay money Loan, borrowed or otherwise withheld from another party, the creditor. Debt may be owed by a sovereign state or country, local government, company, or an individual. Commercial debt is generally subject to contractual terms regarding the amount and timing of repayments of #Principal, principal and interest. Loans, bond (finance), bonds, notes, and Mortgage loan, mortgages are all types of debt. In financial accounting, debt is a type of financial transaction, as distinct from equity (finance), equity. The term can also be used metaphorically to cover morality, moral obligations and other interactions not based on a monetary value. For example, in Western cultures, a person who has been helped by a second person is sometimes said to owe a "debt of gratitude" to the second person. Etymology The English term "debt" was first used in the late 13th century and comes by way of Old French from the Latin verb ' ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Collateral (finance)
In lending agreements, collateral is a borrower's pledge of specific property to a lender, to secure repayment of a loan. The collateral serves as a lender's protection against a borrower's default and so can be used to offset the loan if the borrower fails to pay the principal and interest satisfactorily under the terms of the lending agreement. The protection that collateral provides generally allows lenders to offer a lower interest rate on loans that have collateral. The reduction in interest rate can be up to several percentage points, depending on the type and value of the collateral. For example, the Annual Percentage Rate (APR) on an unsecured loan is often much higher than on a secured loan or logbook loan. If a borrower defaults on a loan (due to insolvency or another event), that borrower loses the property pledged as collateral, with the lender then becoming the owner of the property. In a typical mortgage loan transaction, for instance, the real estate ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Loan
In finance, a loan is the tender of money by one party to another with an agreement to pay it back. The recipient, or borrower, incurs a debt and is usually required to pay interest for the use of the money. The document evidencing the debt (e.g., a promissory note) will normally specify, among other things, the principal amount of money borrowed, the interest rate the lender is charging, and the date of repayment. A loan entails the reallocation of the subject asset(s) for a period of time, between the lender and the borrower. The interest provides an incentive for the lender to engage in the loan. In a legal loan, each of these obligations and restrictions is enforced by contract, which can also place the borrower under additional restrictions known as loan covenants. Although this article focuses on monetary loans, in practice, any material object might be lent. Acting as a provider of loans is one of the main activities of financial institutions such as banks ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Money Market
The money market is a component of the economy that provides short-term funds. The money market deals in short-term loans, generally for a period of a year or less. As short-term securities became a commodity, the money market became a component of the financial market for assets involved in short-term borrowing, lending, buying and selling with original maturities of one year or less. Trading in money markets is done over the counter and is wholesale. There are several money market instruments in most Western countries, including treasury bills, commercial paper, banker's acceptances, deposits, certificates of deposit, bills of exchange, repurchase agreements, federal funds, and short-lived mortgage- and asset-backed securities. The instruments bear differing maturities, currencies, credit risks, and structures. A market can be described as a money market if it is composed of highly liquid, short-term assets. Money market funds typically invest in government se ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Corporate Finance
Corporate finance is an area of finance that deals with the sources of funding, and the capital structure of businesses, the actions that managers take to increase the Value investing, value of the firm to the shareholders, and the tools and analysis used to allocate financial resources. The primary goal of corporate finance is to Shareholder value, maximize or increase valuation (finance), shareholder value.SeCorporate Finance: First Principles Aswath Damodaran, New York University's Stern School of Business Correspondingly, corporate finance comprises two main sub-disciplines. Capital budgeting is concerned with the setting of criteria about which value-adding Project#Corporate finance, projects should receive investment funding, and whether to finance that investment with ownership equity, equity or debt capital. Working capital management is the management of the company's monetary funds that deal with the short-term operating balance of current assets and Current liability, cu ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Project Finance
Project finance is the long-term financing of infrastructure and industrial projects based upon the projected cash flows of the project rather than the balance sheets of its sponsors. Usually, a project financing structure involves a number of equity investors, known as 'sponsors', and a 'syndicate' of banks or other lending institutions that provide loans to the operation. They are most commonly non-recourse loans, which are secured by the project assets and paid entirely from project cash flow, rather than from the general assets or creditworthiness of the project sponsors, a decision in part supported by financial modeling; see Project finance model. The financing is typically secured by all of the project assets, including the revenue-producing contracts. Project lenders are given a lien on all of these assets and are able to assume control of a project if the project company has difficulties complying with the loan terms. Generally, a special purpose entity is created for ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Public Finance
Public finance refers to the monetary resources available to governments and also to the study of finance within government and role of the government in the economy. Within academic settings, public finance is a widely studied subject in many branches of political science, political economy and public economics. Research assesses the government revenue and government expenditure of the public authorities and the adjustment of one or the other to achieve desirable effects and avoid undesirable ones. The purview of public finance is considered to be threefold, consisting of governmental effects on: # The efficient allocation of available resources; # The distribution of income among citizens; and # The stability of the economy. American public policy advisor and economist Jonathan Gruber put forth a framework to assess the broad field of public finance in 2010:Gruber, J. (2010) Public Finance and Public Policy (Third Edition), Worth Publishers, Pg. 3, Part 1 # When shoul ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Warrant (finance)
In finance, a warrant is a Security (finance), security that entitles the holder to buy or sell stock, typically the stock of the issuing company, at a fixed price called the exercise price. Warrants and option (finance), options are similar in that the two contractual financial instruments allow the holder special rights to buy securities. Both are discretionary, and have expiration dates. They differ mainly in that warrants are only issued by specific authorized institutions (typically the corporation on which the warrant is based), and in certain technical aspects of their trading and exercise. Warrants are frequently attached to Bond (finance), bonds or preferred stock as a sweetener, allowing the issuer to pay lower interest rates or dividends. They can be used to enhance the Yield (finance), yield of the bonds and make them more attractive to potential buyers. Warrants can also be used in private equity deals. Frequently, these warrants are detachable, and can be sold inde ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Escrow
An escrow is a contractual arrangement in which a third party (the stakeholder or escrow agent) receives and disburses money or property for the primary transacting parties, with the disbursement dependent on conditions agreed to by the transacting parties. Examples include an account established by a broker for holding funds on behalf of the broker's principal or some other person until the consummation or termination of a transaction; or, a trust account held in the borrower's name to pay obligations such as property taxes and insurance premiums. The word derives from the Old French word , meaning a scrap of paper or a scroll of parchment; this indicated the deed that a third party held until a transaction was completed. Types Escrow generally refers to money held by a third party on behalf of transacting parties. It is mostly used regarding the purchase of shares of a company. It is best known in the United States in the context of the real estate industry (specifically in m ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Government Bond
A government bond or sovereign bond is a form of Bond (finance), bond issued by a government to support government spending, public spending. It generally includes a commitment to pay periodic interest, called Coupon (finance), coupon payments'','' and to repay the face value on the Maturity (finance), maturity date. For example, a bondholder invests $20,000, called face value or principal, into a 10-year government bond with a 10% annual coupon; the government would pay the bondholder 10% interest ($2000 in this case) each year and repay the $20,000 original face value at the date of maturity (i.e. after 10 years). Government bonds can be denominated in a foreign currency or the government's domestic currency. Countries with less stable economies tend to denominate their bonds in the currency of a country with a more stable economy (i.e. a hard currency). All government bonds carry Default (finance), default risk; that is, the possibility that the government will be unable to ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
