Glossary on Trade
Financing Terms - D Glossary on Trade
Financing Terms - D
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D/A: Abbreviation for Documents against acceptance.
Date Draft: A draft which matures a specified number of days after its date of issue, regardless of the date of its acceptance. Compare with Sight draft, Time draft.
Français: Date d'échéance de la traite
Español: Giro fechado
Day-to-day money: See Call money.
Français: Argent
au jour le jour
Español: Day-to-day money
Dealer: A person, or a company, who buys securities for his own account (at his Bid price) or sells them from his own account (at his asked price). Compare with Broker.
Français: Courtier
Español: Vendedor,
agente, concesionario, revendedor, expendedor, detallista, agente de valores
Debenture: A term indicating a fixed-interest Bond secured against the issuing company’s assets (these may consist either of specific assets of the company or of its assets in general). Debenture bonds are distinct from ordinary bonds, the latter being unsecured. Debentures will be paid whether the issuing company makes a profit or not and, in case of Liquidation, debenture holders have priority over ordinary bond holders on the company's remaining assets. Debentures can be bought and sold on a stock Exchange.
Français: Obligation, reconnaissance de dette
Español: Obligación
Debt-equity ratio: The ratio of a company's long-term liabilities (debts) to its Equity (i.e. shareholders' funds). The higher the ratio, the greater the financial Leverage/Gearing of the firm.
Français: Coefficient
fonds propres/endettement, Ratio
fonds propres/endettement
Español: Relación
entre deuda y recursos propios, razón entre deuda y capital, relación de obligaciones a
patrimonio
Debt ratio: The ratio of a company's long-term liabilities (debts) to its total long-term capital employed, i.e. debt plus Equity. See also Gearing.
Français: Coefficient, Ratio
d'endettement
Español: Coeficiente
de endeudamiento
Debt refinancing: The procedure by which overdue payments or future debt-service obligations on an Officially supported export credit are repaid by setting up a new refinancing loan. Such a loan may be extended by an Export credit agency, a governmental institution or a commercial bank. In the latter case it will carry the guarantee of the export credit agency.
Français: Refinancement
de la dette
Español: Refinanciación
de la(s) deuda(s)
Debt rescheduling: In general, the procedure of readjustment of the terms applying to the existing liabilities of a company or a country, such as a reduction of the interest rates applied and/or an extension of the time required for payment.
(1) In an Export credit agency, the term refers to the procedure by which overdue payments or future debt-service obligations on a existing officially supported export credit are converted into a claim by the export credit agency on the debtor country carrying a revised stream of payments.
(2) In the case of heavily indebted developing countries, it indicates the agreement between debtor and creditor countries to modify the terms of the loan when the borrowing country experiences serious debt-servicing problems. Rescheduling may take the form of an extension of the debt maturity date, delayed loan principal payments, reduction of the interest rate, transformation of short-term credits into medium- or long-term lending, etc. See also London Club and Paris Club.
Français: Ré-échelonnement de la dette
Español: Reescalonamiento
(del servicio) de la deuda, renegociación de los vencimientos de la deuda
Debt restructuring: A general term covering both the rescheduling or refinancing of debt-service payments in arrears and/or of future debt-service payments, in response to external payment difficulties.
Français: Restructuration
de la dette
Español: Reestructura
de deuda, renegociación de los pagos (del servicio) de la deuda
Debt-Service Ratio: The ratio of a country's repayments on its foreign debt to its hard-currency export earnings. This ratio is calculated by dividing the sum of the debt repayments (principal and interest) during a reference year by the country's exports for that year. The debt/service ratio is one of the criteria used to measure a country's creditworthiness.
Français: Coefficient : dette-service de la
dette
Español: Proporción
del servicio a la deuda, coeficiente del servicio a la deuda
Debt Servicing: The payment of current interest on borrowed funds, together with the repayment of the principal amount when due.
Français: Service
de la dette
Español: Servicio de
la deuda
Deep discount bonds: Created in the 1970s and used by companies seeking to maximize their immediate Cash flow and investors keen to avoid taxation. These are bonds which carry little or no interest but are sold by the issuing company at a price well below their face value.
Français: Obligations très largement
escomptées
Español: Bono de
descuento intensivo, pagaré de descuento intensivo
Default: The failure to repay a loan on schedule or to make timely payment of interest. If the borrower defaults, his bank will initiate certain legal actions to recover its money or seize the security pledged as collateral for the loan.
Français: Défaut
Español: Incumplimiento
Default interest: The interest rate charged on an overdue debt, from the date of Default to the date of (eventual) settlement.
Français: Intérêt
de défaut
Español: Intereses por
mora
Defeasance: A financing technique used by large companies to borrow money without showing it on their balance sheets. The funds borrowed by the company are used to buy government securities and the income from such securities is used to meet the servicing costs of borrowing. Both the initial borrowing and the securities purchased with it are then tied up in a trust external to the company’s balance sheets.
Français: Defeasance
Español: Anulación,
revocación
Deferred call: A clause which prohibits the issuing company from calling the Bond before a certain date.
Français: Appels
différé
Español: Pago diferido
Deferred letters of credit: A Letter of credit calling for payment at a fixed future date, where the documents do not need to be accompanied by a draft.
Français: Lettres
de crédit différées
Español: Carta
de crédito diferida
Deferred payment credit: An arrangement under which payments due to the exporter on presentation of the shipping documents are deferred for an agreed period of time.
Français: Paiement
de crédit différé
Español: Crédito
con pagos diferidos
Deferred stocks: Shares where payment of the coupon is deferred. It also refers to a stock where market appreciation is expected at a later stage.
Français: Actions
différées
Español: Acciones
diferidas
Deficit: This signifies "in the red", a financial shortfall. For instance, a government will experience a budget deficit when its expenditures exceed its revenues during the reference financial year.
Français: Déficit
Español: Déficit
Deflation: Opposite of inflation. i.e. a sharp decline in prices, leading to an improvement in the purchasing power of money, brought about by a decrease in the amount of money in circulation relative to the goods and services available in the economy. It is usually accompanied by a contraction in capital spending and investment.
Français: Déflation
Español: Deflación
Delivered/duty paid, DDP: A pricing term indicating the maximum obligation of the exporter to deliver the goods and pay the corresponding duties. The term may be used irrespective of the actual mode of transport. If the parties wish to exclude some charges (such as value-added tax or other similar taxes) from the exporter's obligations, they should explicitly state so by adding words to this effect (such as "exclusive of VAT and/or taxes").
Français: Livré /
taxe payée
Español: Entregado
derechos pagados, DDP
Delivered at frontier: The exporter fulfils his obligations by delivering the goods at the border of the country of destination, but before the "customs border", i.e. without undertaking the customs clearance formalities. The term usually applies to goods transported by rail or road but may be used also in connection with other modes of transport.
Français: Livré
à la frontière
Español: Entregada
en frontera, DAF
Delivery: F.O.B. or C.I.F. delivery of the goods.
Français: Livraison
Español: Entrega
Delivery period: The time required to deliver the exported goods, extending from the signature of the sale contract to the actual delivery of the merchandise.
Français: Période
de livraison
Español: Plazo de entrega
Demand draft: A payment order payable upon presentation.
Français: Traite à vue
Español: Giro a la vista
Demand line of credit: A line of credit arranged by a bank, enabling its clients to borrow on a daily or an on-demand basis.
Français: Ligne
de crédit à vue
Español: Línea
de crédito a la vista
Demurrage: The extra time required to load or unload a vessel, as compared with that specified in the contract. The term refers only to those situations in which the charterer or shipper, rather than the vessel's operator, is at fault.
Français: Surestarie
Español: Sobrestadía,
gastos de sobrestadía, detención en muelle
Dependency: The term may be used to indicate the condition of a country which relies excessively on the sale of one primary commodity and/or is too dependent on another country as a customer and supplier.
Français: Dépendance
Español: Dependencia
Deposit of estimated duties: In an Antidumping procedure, the term indicates the duties to be collected on imported merchandise found to be subject to Dumping.
Français: Dépôt
de taxes estimées
Español: Consignación de aranceles estimados
Deposits: On the balance sheet of a company, the funds accepted from customers or banks are generally indicated as deposits. See also: Receivables, Advances and loans.
Français: Dépôts
Español: Depósitos
Depreciation: (1) In financial markets, the decrease in the value of an asset due either to real factors (i.e. the worsening of its revenue prospects) or often simply to fear.
(2) In accounting, the amount allocated each period to Amortize the book value of fixed assets.
(3) On the foreign exchange markets, the decrease in the market value of a currency, where this decrease has taken place without any intervention by the country's monetary authorities. Compare with Devaluation.
Français: Dépréciation
Español: Depreciación,
amortización
Depression: A long-lasting recession in economic activity.
Français: Dépression
Español: Depresión,
crisis económica
Deregulation: The removal of government control on the conduct of economic activity in a particular sector, typically taking the form of rules or price controls. It implies that market forces take effect without any government restrictions.
Français: Déréglementation
Español: Desreglamentación, liberalización
Derivatives: Securities contracts whose prices are based on the price of an underlying asset (such as goods, securities, foreign currency, etc.) already quoted on the market; e.g. Futures, Options.
Français: Dérivés
Español: Derivado
Devaluation: The official decision by a country’s monetary authorities to reduce the value of the domestic currency in relation to foreign currencies, i.e. to reduce the foreign currency equivalent of the domestic currency. e.g. if the U.S. dollar is devalued in relation to the French franc, one dollar will "buy" fewer francs than before. Opposite: Revaluation. Compare with Depreciation.
Français: Dévaluation
Español: Devaluación
Development Bank: A lending agency which provides financial assistance for the promotion of a country’s industrial and trade activity. Development banks are typically active in developing countries.
Français: Banque
de développement
Español: Banco de
desarrollo
Development carve-out: A portion of the product payment estimated to cover the development costs (intangible expenses) of an oil or gas well or mine.
Français: Développement "carve-out
Español: Desarrollo
indirecto
Development carve-out loan: A loan secured by a Development carve-out.
Français: Prêt de développement
"carve-out
Español: Préstamos para dsarrollos
indirectos
Development Finance Institutions (DFIs):
DFIs are set up to support the undertaking of industrial and development projects through the extension of long-term loans on more favourable conditions than those offered by commercial banks. DFIs are usually also willing to take greater risks than commercial banks. They include Development banks and industrial finance corporations.
Français: Institutions pour le
développement financier
Español: Institución
de financiación del desarrollo, banco de fomento
Direct costs: The term refers to costs which can be directly related to the production of particular units or lines of products. They include the wages of the personnel and the cost of inputs used in the manufacture of such products.
Français: Coûts directs
Español: Costos
directos, costo neto
Direct Credit: A financing arrangement (buyer or supplier) provided directly by an ECA to the importer or exporter as borrower.
Français: Crédit direct
Español: Crédito directo
Direct lease: A lease in which the lessor purchases new equipment from the manufacturer and leases it to the lessee.
Français: Bail direct
Español: Contrato
de arrendamiento directo
Direct payment: Payments owed by the buyer which must be settled in cash during the contractual period, not being eligible for financing under a buyers or suppliers' credit.
Français: Paiement
direct
Español: Pago directo
Direct quote: In foreign exchange operations, the number of units of the domestic currency required to buy one unit of a foreign currency. Compare with Indirect quote. See also Quoted currency.
Français: Cotation
directe
Español: Cotización
directa
Direct yield:See Yield.
Français: Rendement
direct
Español: Rendimiento
directo
Dirty float: A system of floating exchange rates where the domestic monetary authorities occasionally intervene to manage and control the exchange rate by buying or selling domestic currency against foreign Reserve currencies. In a Clean float, no intervention is used.
Français: Fluctuations
contrôlée
Español: Flotación
sucia, flotación impura, flotación manipulada
Disagio: In the securities market, a situation where the market price of a security is lower than its nominal or par value. In foreign exchange operations, the discount charged for exchanging a depreciated foreign currency or for exchanging abraded or used coins. Opposite: Agio.
Français: Disagio
Español: Desagio
Disbursement: A term used in accounting and finance to indicate the actual cash disbursements.
Français: Déboursement
Español: Desembolso
Discount: (1) In commercial trade, a rebate in the selling price of goods or services, usually made by deducting a certain percentage from the quoted price.
(2) In finance, the deduction from the face value of Commercial paper such as a Bill of exchange or acceptance, in exchange for the option of receiving the relative cash payment before the maturity of the paper. By purchasing at a discount, the buyer of the commercial paper is compensated for the loss of interest on the funds up to the paper’s maturity.
(3) When referring to the selling price of a bond or other security, this indicates a market price below its par value.
(4) In accounting, the calculation of the present value of a stream of future Cash flows. It is the opposite of Compounding.
(5) In foreign exchange trading, a foreign currency sells at a discount on the forward market when the forward rate is lower than the spot rate (assuming that the domestic currency is quoted on a direct basis), i.e. that it is cheaper to buy the foreign currency forward rather than spot.
Français: Escompte
Español: Descuento
Discount credit: A credit by a bank for the provision of funds when the client presents a Bill of exchange or similar Commercial paper for discounting.
Français: Crédit
escompte
Español: Línea de
descuento
Discount rate: (1) The interest rate at which a bank or other lender agrees to make advance payments to the holder of a bill of Exchange or other Commercial paper, i.e. the deduction from its face value practised by the bank. It is thus a charge on the person or company seeking to discount his bills, and depends on the time left until the maturity of the instrument, the liquidity of the financial markets, etc.
(2) The interest rate at which a country’s Central Bank lends to commercial banks, when these are temporarily short of funds. Commercial banks need to pledge government and other first-class debt instruments as collateral to borrow from their Central Bank. Such borrowings are of a short-term nature as they are meant to meet the short-term liquidity needs of commercial banks.
Français: Taux
d'escompte
Español: Tipo de
descuento
Discount window: A facility offered by a county’s Central Bank by which commercial banks may borrow short-term (at the Discount rate), for instance in order to adjust to sudden changes in their assets and liabilities portfolio.
Français: Facilité
d'escompte
Español: Servicio
de redescuento
Discounted cash flow: The present value of future Cash flows, taking into account the timing of the future stream of payments. Take an example of an anticipated cash flow of £100. Its present value is lower, as it could be invested and earn interest. If a current investment of £92 is worth £100 by the end of the year, the discounted cash flow value of the anticipated £100 would be £92. Discounted cash flows are used when comparing alternative investment options, entailing different payment and revenue time structures. See also Capitalized value.
Français: Flux de trésorerie escomptés
Español: Flujo
de efectivo actualizado
Dishonour: Refusal on the part of the drawee to accept a draft or to pay it when due.
Français: Ne
pas honorer
Español: Falta de pago, falta de aceptación
Disintermediation: The process of excluding banks and other financial institutions from the collection and allocation of financial resources in the economy. Disintermediation may take different forms, for example the decision of companies to rely on bond and Equity issues rather than on bank loans to finance their activities.
Français: Désintermédiation
Español: Desintermediación
Dispatch: An amount paid by a vessel's operator to a charterer, if the loading or unloading of the vessel is completed more quickly than was stipulated in the charter agreement.
Français: Prime de
rapidité
Español: Prima de celeridad,
prima por pronta carga y descarga
Disposable income: Income (cash) after tax.
Français: Revenu
disponible
Español: Ingresos
disponibles
Distributor: An Agent who sells directly on behalf of and according to the instructions of the supplier and maintains an inventory of the latter's products.
Français: Distributeur
Español: Distribuidor
Diversification: The practice of dividing financial resources among a variety of investments with different risks, reward, maturity etc. in order to minimise the overall risk.
Français: Diversification
Español: Diversificación
Diversionary dumping: A practice by which a foreign producer sells to a third-country at a price lower than the fair value and the product is then further processed and shipped to another country. See also Dumping.
Français: Dumping
de diversion
Español: Dumping
indirecto
Divestment: A reduction in the amount of current investment, sometimes through the sale of assets.
Français: Désinvestissement
Español: Desinversión
Dividend: A portion of the profit of a limited liability company (corporation) paid out to its shareholders. From the shareholders' point of view, it is the return on their investment in the company’s stock. A stock sold for 20US$ a share with an annual dividend of 1US$ a share, yields the investor 5%. The rate of dividend is determined at the General Meeting on the proposal of the Board of Directors.
Français: Dividende
Español: Dividendo
Dividend cover: The ratio of profits distributed as dividends to total profits. It gives an indication of the company’s dividend policy and on the likely distribution of future dividend payments.
Français: Couverture
du dividende
Español: Cobertura
de dividendos
Dividend yield: This indicates the expected return on the purchase a particular share. It is calculated by dividing the last total annual dividend payment per share by the share’s market price.
Français: Rendement
du dividende
Español: Rentabilidad
del dividendo
Dock receipt: A receipt issued by the ocean carrier upon the handing over of the merchandise at the port of embarkation for shipment.
Français: Reçu de dock
Español: Recibo
provisional de mercancías entregadas sobre muelle
Documentary acceptance credit: An acceptance credit used for import or export financing, usually secured by an irrevocable documentary credit issued by the buyer's bank.
Français: Crédit d'acceptation documentaire
Español: Crédito documentario de aceptación
Documentary collection: An international payment technique allowing each party to retain key elements of control and increasing the level of security of the transaction, even in the absence of a Letter of credit. The importer is not required to pay the exporter before the merchandise ordered is shipped, while the exporter is able to retain title to the goods until the importer either pays the draft (Document against Payment, D/P) or accepts it (Document against Acceptance, D/A). In both cases the bank acts only as an agent for the exporter, regulating the timing of the transaction and seeking payment from the overseas buyer/importer. The basis of execution of documentary collections is provided by the Uniform Rules for Collections (URC) drafted by the International Chamber of Commerce in Paris.
Français: Encaissement
documentaire
Español: Cobro
de créditos documentarios
Documentary Credit: A commercial letter of credit authorising the bank to pay a designated beneficiary (typically the seller/exporter of goods) against presentation of the documents specified in the Letter of credit.
Français: Crédit
documentaire
Español: Crédito
documentario
Documentary draft: A term indicating the draft drawn by the seller on the buyer relating to a Documentary collection. If the draft contains the notation Documents against acceptance, the documents giving title to the goods are handed over upon acceptance of the draft by the buyer. If it is marked Documents against Payment, they are handed over only after payment.
Français: Traite
documentaire
Español: Giro
documentario
Documentary letter of credit: See Letter of credit.
Français: Lettre de crédit documentaire
Español: Carta
de crédito documentario
Documented discount notes: A Commercial paper backed not only by normal bank lines, but also by a Letter of credit from a bank stating that it will pay the paper at maturity if the borrower does not honour it. Such a paper is also referred to as a letter of credit paper.
Français: Bordereau d'escompte documenté
Español: Pagaré
de descuento documentario
Documents: This refers to papers attached to drafts issued in international trade transactions which usually include an ocean Bill of lading, Marine insurance certificates and commercial Invoices and, when required, Certificates of origin and Consular documents.
Français: Documents
Español: Documentos
Documents against acceptance (D/A): A notation on a draft issue in an export transaction stating that the documents attached to the draft and giving title to the shipped goods should be handed to the buyer (drawee) only upon his acceptance of the draft.
Français: Documents
contre acceptation
Español: Documentos
contra aceptación
Documents against payment(D/P): A notation on a draft issued in an export transaction stating that the documents attached to the draft and giving title to goods should be handed to the buyer (drawee) only against payment of the draft.
Français: Documents
contre paiement
Español: Documentos
contra pago
Domestic issue: Loan stock or equity raised on the capital market of the country of issue and expressed in its domestic currency, such as US dollars raised in the USA, Dutch florins raised in Holland.
Français: Emission
domestique
Español: Emisión
local, emisión interna
Domiciles: The place where a draft or acceptance is due for payment.
Français: Domicile(s)
Español: Domicilio
Dow Jones index: The share index showing movements on the New York Stock Exchange. The most widely known NYSE index is the Dow Jones industrial average, based on thirty leading stocks in US industry and other sectors of the economy. A similar index in the United Kingdom is the Financial Times Industrial Ordinary index.
Français: Indice Dow
Jones
Español: Indice Dow Jones
Down payment: An advance cash payment from the buyer to the supplier before the entry into force of the contract. It is sometimes known as an initial direct payment. Downpayments on exports are usually ineligible for ECA support.
Français: Acompte
Español: Pago inicial, depósito
inicial, pago de entrada
Downpayments/progress payment bond
or guarantee: A bond or guarantee, issued by a bank to the buyer, whereby the bank undertakes to reimburse him (usually on demand) for the downpayments or progress payments already made in case of
failure by the supplier to complete the contract.
Français: Acomptes/Obligation
ou garantie de paiement relative à l’avancement
Español: Bono de
pago inicial, bono de pago a cuenta, bono de pago parcial
Downstream dumping: The practice whereby a foreign producer sells at below cost to another producer within his domestic market, and the product is then further processed and shipped to another country. See also Dumping.
Français: Dumping en
aval
Español: Dumping
en el proceso de comercialización, dumping posterior, dumping en fases posteriores al
proceso de protección
Downturn; Slump: A general and marked decline in asset prices or currency rates. Opposite: Boom.
Français: Effondrement
Español: Descenso,
depresión, crisis económica, baja repentina
Draft: Another word for Bill of exchange. It is a written, unconditional payment order from one person (drawee) to another (Drawer), under which the drawee is to pay a specified sum of money, in a given currency and on a specified date, to the drawer. A sight draft calls for immediate payment (i.e. on sight), while a time draft calls for payments at a predetermined future date.
Français: Traite
Español: Draft
Drawback: The refund of duties paid on imported goods, provided at the time of their re-exportation. See duty.
Français: Remboursement
Español: Reintegro
de los derechos de aduana, devolución de los derechos de importación
Drawdown period: Under a loan or credit agreement, this is the specified period during which the funds may be drawn.
Français: Période
de tirage
Español: Período de giro
Drawee: In general, this indicates the individual or firm on whom a draft is drawn and who owes the indicated amount. In an international trade transaction, the drawee may be:
(1) The person or firm to whom a draft/bill of exchange is addressed and who is expected to accept it and pay it on maturity (i.e., the importer).
(2) The bank on which the cheque was drawn and which cashes the cheque to the debit of the drawee if the necessary cover is available.
Français: Tiré
Español: Librado
Drawer: The individual, or firm, who issues or signs a Draft/bill of exchange, thus standing as the beneficiary of the indicated payment from the drawee.
Français: Tireur
Español: Librador
Drawings: Borrowings from the IMF reserves are sometimes referred to as drawings. See also Special Drawing Rights.
Français: Tirages
Español: Préstamo
Drawn bond: A Redeemable Bearer bond which has been drawn, i.e. selected for repayment, and which the holder should return to a specified paying agent, or to the issuer, for payment.
Français: Obligation
tirée
Español: Bono girado
Drop ship: A shipment by a foreign shipper directly to the domestic customer. The quoted price includes freight and postage.
Français: Drop ship
Español: Embarque
entregado
D/P: Abbreviation for Documents against payment.
Dual pricing: The selling of identical products in different markets at different prices. This may in some cases reflect Dumping practices.
Français: Double
cotation
Español: Dualidad
de precios, doble precio, sistema de doble precio, régimen de precios dobles
Due date; Maturity date: The date on which a debt (such as a bill of Exchange , Note, Coupon, etc.) becomes due for payment. If the debtor fails to undertake the payment on the due date he is said to be in Default.
Français: Date
d’échéance
Español: Fecha de
vencimiento (del plazo), fecha de cumplimiento
Dumping: The sale of goods in a foreign market at less then their fair value, generally implying at below their cost of production. Dumping is generally recognized as unfair as it may disrupt markets and harm the producers of competing products within the importing country.
Français: Dumping
Español: Dumping
Duration; term: (1) The period of time between the date of issue of a Debenture and that of its repayment
(2) The time during which a loan or credit is granted, also known as its maturity or life.
Français: Durée, terme
Español: Duración, plazo
Duty: A tax imposed by the customs authority of a country on imported goods.
(1) Ad valorem duty: a duty calculated on the monetary value of the imported goods.
(2) Specific duty: a duty calculated on the weight or quantity of imported goods, without any reference to their monetary value or market price.
(3) Compound duty: a duty based on the combination of the goods’ monetary value and other factors.
(4) Drawback: the total or partial refund of a duty paid on imported merchandise at the time of re-exportation, where the exported goods may have the same form or a different form than at the time of import.
Français: Taxe
Español: Derechos de
aduana
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