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Definition of Operating Loan
A loan advanced under an operating line of credit.
For investment companies, the management fee and "other expenses,"
A loan in which two companies in separate countries borrow each other's currency for a
A short term loan to cover the immediate cash requirements until permanent financing is received.
Related: Call money rate.
A mortgage loan on newly developed property that the builder subsidizes during the
A bank term loan that calls for no amortization.
This equals the cash inflow from sales during the period minus the cash
With some exceptions, the cash effects of transactions
An agreement between a creditor and a borrower, where the creditor has loaned an amount to the borrower for business purposes.
Overnight, collateralized loan made to a dealer financing his position by borrowing from a
a factor that indicates how a percentage change in sales, from the existing or current
Percentage change in profits given a 1 percent change in sales.
A loan which must be repaid in full on demand.
Given the after-tax stream associated with a lease, the maximum amount of conventional
Federal Home Loan Banks
The institutions that regulate and lend to savings and loan associations. The
A loan on which the rate paid by the borrower is fixed for the life of the loan.
Fixed Rate Loan
loan for a fixed period of time with a fixed interest rate for the life of the loan.
Freddie Mac (Federal Home Loan Mortgage Corporation)
A Congressionally chartered corporation that
loan made by one unit of a corporation to another unit of the same corporation.
A secured short-term loan to purchase inventory. The three basic forms are a blanket
loans of $1 billion or more. Or, loans that exceed the statutory size limit eligible for purchase or
Loan amortization schedule
The schedule for repaying the interest and principal on a loan.
Borrowed funds having a fixed interest rate.
Express stipulations included in loan agreements that are designed to monitor
Group of banks sharing a loan. See: syndicate.
The amount a policyholder may borrow against a whole life insurance policy at the interest rate
Amounts that have been loaned to the company and that it still owes.
Give the borrower the possibility of drawing a loan in different currencies.
loans usually represented by conventional mortgages on multi-family rental apartments.
Negative Loan Covenants
loan covenants designed to limit a corporate borrower's behavior
Net operating losses
Losses that a firm can take advantage of to reduce taxes.
Net operating margin
The ratio of net operating income to net sales.
Includes all the sales and expense activities of a business.
a budget expressed in both units and dollars
Operating cash flow
Earnings before depreciation minus taxes. It measures the cash generated from
operating cash flow
See cash flow from operating activities.
Operating Cash Flow
Income available after the payment of taxes, plus the value of the
The average time intervening between the acquisition of materials or services and the final
A term frequently used to describe earnings after the removal of the
Any expense associated with the general, sales, and administrative
The total amount that was spent to run a company this year.
The amount of money the company must spend on overhead, distribution, taxes, underwriting the risk and servicing the policy. It is a factor in calculating premium rates.
Degree to which exchange rate changes, in combination with price changes, will alter a
The net income of a business, less the impact of any financial activity,
A measure of results produced by the core operations of a firm. It is common
Short-term, cancelable lease. A type of lease in which the period of contract is less than the
The rental of an asset from a lessor, but not under terms that would
One where the risks and benefits, as well as ownership, stays with the lessor.
Fixed operating costs, so-called because they accentuate variations in profits.
A relatively small percent increase or decrease in
the proportionate relationship between
Degree to which costs are fixed.
Operating Line of Credit
A bank's commitment to make loans to a particular borrower up to a specified maximum for a specified period, usually one year.
The profit made by the business for an accounting period, equal to gross profit less selling, finance, administration etc. expenses, but before deducting interest or taxation.
See earnings before interest and income tax (EBIT).
Operating profit margin
The ratio of operating margin to net sales.
The inherent or fundamental risk of a firm, without regard to financial risk. The risk that is
operating risk (business risk)
Risk in firm’s operating income.
A process whereby two companies in different countries borrow each other's currency for a
A lump sum that you borrow from a financial institution for a specified period of time. To repay the loan, you pay interest on the entire lump sum, and make payments on a scheduled basis.
Positive Loan Covenants
loan covenants expressing minimum and maximum financial measures
Project loan certificate (PLC)
A primary program of Ginnie Mae for securitizing FHA-insured and coinsured
Project loan securities
Securities backed by a variety of FHA-insured loan types - primarily multi-family
Usually FHA-insured and HUD-guaranteed mortgages on multiple-family housing complexes,
Savings and Loan association
National- or state-chartered institution that accepts savings deposits and
secured loan or line of credit
A lump sum of funds (loan), or a revolving source of credit with a pre-established limit (line of credit), for which the customer must provide collateral.
loan to finance current assets, The sale of the current assets provides the cash to repay
Short-run operating activities
Events and decisions concerning the short-term finance of a firm, such as
A bank loan, typically with a floating interest rate, for a specified amount that matures in between
A secured loan made to business concerns for a specific period (normally three to ten years). It is repaid with interest, usually with periodical payments.
A loan extended by a bank for a specific purpose. In contrast, lines of credit and revolving
Variable rate loan
loan made at an interest rate that fluctuates based on a base interest rate such as the
This term has two quite different meanings. First, it may
negative cash flow
The cash flow from the operating activities of a business
Net Cash after Operations
Cash flow available for debt service—the payment of interest and principal on loans. Generally calculated as cash provided by operating activities before interest
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