banker's acceptance

The banker's acceptance specifies the amount of money, the date, and the person to which the payment is due.

Banker's acceptances smaller than this amount are referred to as odd lots.

The rates at which they trade, calculated from the discount prices relative to their face values, are called banker's acceptance rates.

For example, an importer may draft a banker's acceptance when it does not have a close relationship with and cannot obtain credit from an exporter.

If the drawee is a bank, the acceptance is called a banker's acceptance.

A banker's acceptance starts off as a bill of exchange, which is itself a form of IOU.

To count as a banker's acceptance a bank must add its own credit to that of the drawer by adding its name to the bill or 'endorsing' it.

Banker's acceptances, eligible; annual survey Bankruptcy, consumer; report to Congress Banks--See also specific type of bank or specific topic.

In general finance terminology, an all-in rate is the rate used in charging customers for accepting banker's acceptances, consisting of the discount interest rate plus the commission.

A banker's acceptance, or BA, is a promised future payment, or time draft, which is accepted and guaranteed by a bank and drawn on a deposit at the bank.

A banker's acceptance starts as a time draft drawn on a bank deposit by a bank's customer to pay money at a future date, typically within six months, analogous to a post-dated check.

Banker's acceptances make a transaction between two parties who do not know each other more safe because they allow the parties to substitute the bank's credit worthiness for that who owes the payment.

National banks were authorized to accept time drafts, and the Federal Reserve was authorized to purchase certain eligible bankers' acceptances, but today the US central bank no longer buys banker's acceptances (but instead buys mostly US government bonds from a Primary dealer).

The party that holds the banker's acceptance may keep the acceptance until it matures, and thereby allow the bank to make the promised payment, or it may sell the acceptance at a discount today to any party willing to wait for the face value payment of the deposit on the maturity date.

Last October, Banco de Mexico took a preliminary step toward revitalizing the traditional financial system by allowing banks, which in 1987 were also permitted to sell a third of their stock to private investors, to set their own interest rates on banker's acceptances, which are used to pay the specific bills owed by customers as they come due.