Glossary on Trade Financing Terms
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Earning per share: This measures a company's total net return earned on ordinary share capital. It is calculated by deducting taxation, depreciation, interest charges and payments to preference shareholders and other minority interests from gross income. The result is then divided by the number of ordinary shares.
Français: Bénéfice
par action
Español: Utilidades por acción,
ingresos por acción
Earning power: This refers to a company’s profitability, i.e. its capacity to return a profit or income. It is measured in terms of the profit generated during a certain period of time in relation to the capital employed. More narrowly defined, it is represented by the ratio between the net profit generated and the capital resources employed.
Français: Capacité
bénéficiaire
Español: Rentabilidad
Earnings: A technical accounting term, referring to the amount of profit (usually for a year) available to the ordinary shareholders (UK) /common stockholders (US), i.e. the profit available once all expenses (operating expenses, interest charges, taxes and dividends on preferred stock) have been deducted from the gross revenue. The term earnings is sometimes used to describe income, net income, profit or net profit.
Français: Bénéfices,
Gains
Español: Ganancias, beneficios,
utilidades, ingresos
Earnings yield: Earnings per share divided by stock price.
Français: Rendement
du bénéfice
Español: Dividendo
por acción
ECA: Abbreviation for Export Credit Agency.
E-commerce: Electronic commerce can be both:
(1) the on-line ordering, payment and delivery of intangible goods and services (Direct e-commerce);
(2) the electronic ordering of tangible goods, which must still be physically delivered, using traditional channels such as postal services or commercial couriers. Payment is made either physically or electronically (Indirect e-commerce).
Français: Commerce
électronique
Español: Comercio
electrónico
Economic growth: The increase in a country’s output of goods and services, i.e. a larger GNP, during a period of time. When economic growth exceeds population growth, the country's living standards should rise. Such a development is generally due to better utilization of the country's economic resources.
Français: Croissance
économique
Español: Crecimiento
económico
ECP: Abbreviation for Eurocommercial paper.
ECU: Abbreviation for European Currency Unit.
ECU bonds: Eurobonds denominated in ECUs.
Français: Obligations
en ECU
Español: ECU bonds
ECU notes: Euronotes denominated in ECUs.
Français: Eurodettes
Español: ECU notes
EFT: Abbreviation for Electronic Funds Transfer.
Effective Yield:See Yield.
Français: Rendement
effectif
Español: Rendimiento
efectivo
Electronic banking: Refers to the provision of retail and small value banking products and services through electronic channels. Two fundamental aspects of electronic banking are:
(1) the nature of the delivery channels - "closed networks" which restrict access to members, and "open networks" which have no membership requirements;
(2) the means of customer access to these channels - including point-of-sale (POS) terminals, automatic teller machines (ATM), telephones, personal computers, smart cards etc.
Internet banking - also known as e-mail banking or virtual banking - is the latest form of electronic banking. Access to the service for the customer is provided via personal computers, communicator phones and other devices with access to the Internet.
Français: Electronique
bancaire
Español: Operación
bancaria electrónica
Electronic funds transfer: The transfer of funds, other than a transaction originated by cheque, draft or similar paper instrument, which is initiated through an electronic terminal, telephonic instrument, computer or magnetic tape, so as to order, instruct or authorize a financial institution to debit or credit an account.
Français: Transfert électronique de fonds
Español: Transferencia electrónica de fondos
Electronic money: Refers to "stored value" or prepaid payment mechanisms for executing payments via point-of-sale (POS) terminals, direct transfers between two devices or over open computer networks such as the Internet. Stored value cards can be "single-purpose" cards, used to purchase one type of goods or service or products from one vendor, or "multi-purpose" cards, used for a variety of purchases from several vendors.
Français: Monnaie
électronique
Español: Dinero
electrónico
Endorsee: The person or corporate body to whom the title and/or rights of a negotiable instrument are transferred from the endorser, by means of the latter's signature.
Français: Endossataire
Español: Endosatario, portador, tenedor
por endoso
Endorsement: The only method recognized in commercial law of transferring title and/or rights on a negotiable instrument. The transfer is achieved by writing one's name on the instrument, usually on the reverse. The signature must be accompanied by conditional or restrictive wording and constitutes a contract between the holder and all parties to such an instrument.
Français: Endossement
Español: Endoso
Endorser: The person or corporate body, with title and/or rights to a negotiable instrument, who writes his name on it in order to transfer the said title or rights to another person or body.
Français: Endosseur
Español: Endosante,
cedente
Endowment capital: Seed or start up capital made available to either a public or private company, by the government or by the company’s holding company respectively.
Français: Dotation
en capital
Español: Dotación de
capital
EPC contract: A contractual agreement between the client (i.e. the owning company which has issued the contract) and the contractor, which outlines the terms of the contractor's responsibility for the Engineering, Procurement and Construction (EPC) activities linked to the project.
Français: Contract EPC
Español: Contrato de
ingeniería, adquisición y construcción
Equivalent bond yield: The annual yield on a short-term, non-interest-bearing security calculated so as to be comparable with yields on coupon securities.
Français: Rendement obligataire équivalent
Español: Rendimiento equivalente al de los
bonos
Equity: The part of a company's capital belonging to its shareholders. In accounting terms, equity is what is left when all the company's liabilities have been deducted from its assets, except for those liabilities due to shareholders. The value of equity of a quoted company corresponds to the price per share multiplied by the number of shares.
Français: Actif
net
Español: Participación
de beneficios
Escrow accounts: Accounts held in Offshore banks, outside the country of a debtor, through which a portion of his export revenues are channelled in order to cover future debt-service payments. The beneficiaries of the escrow accounts are the creditors who will obtain extra security for their loans and priority in debt service.
Français: Comptes de
dépôt
Español: Cuenta de
garantía bloqueada, cuenta de depósito en garantía
Euro: A new currency introduced 1 January 1999 between 11 member states of the European Union (Italy, France, Germany, Spain, Portugal, Austria, Finland, Belgium, Luxembourg and The Netherlands) as the final step in the process leading to full Economic and Monetary Union (EMU) within the EU. The Euro will gradually replace the use of the national currencies and will become the only currency in circulation within the EU by 1 July 2002. The parity Euro-ECU has been set at one-to-one.
Euro Lines: Lines of credit granted by international banks in Eurocurrencies.
Français: Lignes
of credit
Español: Eurolíneas
Eurobond: A Bond issued by a company or a government in a market other than that of its currency of denomination. Eurobonds are then sold internationally and not in just one domestic market (e.g. a German corporation may issue euro-dollar bonds on the London capital market). The main eurobonds include the Eurodeutsche Mark bonds, Eurodollar bonds, Eurofrench Franc bonds, Eurosterling bonds and Euroyen bonds, although the nationally denominated European eurobonds will be phased out within Europe.
Français: Euro-obligation
Español: Eurobono
Eurocapital market: The section of the Euromarkets where transactions with
medium- to long-term maturities are conducted, mainly in the form of Eurobond
Français: Marché
des Euro-capitaux
Español: Euromercado
de capitales
EuroCDs (Certificate of deposit): CDs issued by a non resident bank in a Euro currency
Français: EuroCD (certificat de Dépôt)
Español: Eurocertificado
de depósito
Eurocommercial paper: Abbreviated as ECP or Euro-CP. It indicates short-term money market paper issued by major first-class companies on the Euromarket, usually without necessarily being underwritten by the lead issuing bank.
Français: Euro-effet
commercial
Español: Efecto
comercial en eurodivisas
Eurocredit: An international bank credit denominated in a Eurocurrency, i.e. denominated in a currency other than the domestic currency of the bank granting the loan. Eurocredits may be provided to governments and corporations and usually have a variable interest rate charge, which is adjusted every few months. Large loans are handled by syndicates of banks.
Français: Eurocrédit
Español: Eurocrédito
Eurocurrency: A currency which is banked outside its country of origin. The main Eurocurrencies include the Eurodollar, the Euro-FF, the Euro-DM, the Euro-£, the Euro-guilder, etc.
Français: Euromonnaie
Español: Eurodivisa
Eurocurrency market: A money market, based mainly in Europe, engaged in the lending and borrowing of Eurocurrencies to finance international trade and investment projects. The main financial instrument used in the Eurocurrency market for long-term investment purposes is the Eurobond. Depositors in the Eurocurrency market include commercial banks, industrial companies and Central Banks. Borrowers are typically companies, which resorted to Eurofinance during times of domestic credit restrictions and/or when domestic interest rates were higher than those prevailing in the Eurocurrency market.
Français: Marché
des Euromonnaies
Español: Mercado de
eurodivisas
Eurodollars: U.S. Dollar-denominated deposits held in banks and other financial institutions outside the United States. Although the majority of such deposits are held in Western Europe (thus leading to the "Euro" denomination), they are not limited to this area.
Français: Eurodollars
Español: Eurodólar
Eurodollar bonds: Eurobonds denominated in dollars.
Français: Obligations
en Eurodollar
Español: Eurodollar bonds
Euroequity market: The market for shares sold outside of their country of origin.
Français: Marché
des Euro-actions
Español: Mercado
de euroacciones
Euromarket: An international financial market consisting of several specialized markets (such as the Eurobond and the Eurocurrency markets) on which bank loans and bond issues are transacted in Eurocurrencies. Although its name refers to Europe, the Euromarket is by no means confined to it geographically but is organized world-wide.
Français: Euromarché
Español: Euromercado
Euromoney market: The part of the Euromarket where transactions involving short- to medium-term placements (i.e. not exceeding 18 months) are conducted, primarily in the form of time deposits.
Français: Euromarché
de l’argent
Español: Euromercado
del dinero
Euronotes: Medium-term notes issued on the Euromoney market.
Français: Europapier
Español: Europagaré
European Bank for
Reconstruction and Development (EBRD): A London based financial institution which began its operations in June 1991. It provides financial assistance to facilitate the transition to market economies and to promote private and entrepreneurial initiatives in Central and Eastern Europe.
Français: Banque
Européenne pour la Reconstruction et le Développement
Español: Banco Europeo de
Reconstrucción y Desarrollo
European Currency Unit (ECU): This was introduced in 1979 with the coming into effect of the European Monetary System (EMS). The ECU is based on a basket of European currencies and its value is equal to the sum of the values of the EC currencies included in the reference basket.
Français: Unité
Monétaire Européenne
Español: Unidad
Monetaria Europea
European Free Trade Association (EFTA): A regional organization, established in December 1960 by the Stockholm Convention as an alternative to the European Economic Community, designed to provide a free trade area for industrial products among member countries. Unlike the EEC, however, EFTA members did not set up a common external tariff and did not fully liberalise agricultural trade. EFTA currently has four members: Iceland, Liechtenstein, Norway and Switzerland. Other members such as the U.K., Denmark, Portugal, Sweden, Finland and Austria left EFTA when they joined the EC.
Français: Association Européenne de
Libre Echange (AELE)
Español: Asociación Europea de Libre
Comercio
European Investment Bank (EIB):An independent public institution set up by the Treaty of Rome of 1957 with the mission of contributing to the steady and balanced development of the European Union (EU). The members of the EIB are the EU Member States, who have all subscribed to the Bank's capital. The EIB provides companies and public institutions with long-term finance for specific capital projects; typically regional and structural development projects with cross-border effects. The EIB collaborates closely with the banking community, both when borrowing on the capital markets and when financing capital projects. It also undertakes activities outside the European Union, either out of its own resources or under mandate of the EU or the Member States.
Français: Banque Européenne
d’Investissement (BEI)
Español: Banco
Europeo de Inversión (BEI)
European Monetary System (EMS):A co-operative foreign exchange arrangement set up in 1979 and involving most of the members of the European Community, designed to promote exchange rate stability within the EC. By requiring participants to maintain their exchange rates within set fluctuation margins, the EMS was intended to move Europe toward closer economic integration and to avoid disruption to trade resulting from excessive exchange rate swings.
Français: Système monétaire européen (SME)
Español: Sistema
Monetario Europeo (SME)
European Monetary Union (EMU): The final stage of the process of macro-economic integration at the European Union level. European countries participating in the EMU are required to hand over the conduct of their monetary policy to a single European Central Bank and to respect stringent guidelines on government spending (the so called Stability Pact). The most apparent aspect of the EMU is the introduction and gradual switchover to a single currency, the Euro.
Français: Union monétaire européenne (UME)
Español: Unión
Monetaria Europea (UME)
European option: An option which can only be exercised at its expiry date. Compare with an American option.
Français: Option
européenne
Español: Opción europea
European terms: The quotation of a foreign currency on an indirect basis. See also indirect quote.
Français: Termes
européens
Español: Términos
europeos
Euro-Treasuries: A security on the Eurobond market entitling the holder to buy a particular US Treasury bond at a fixed price, at any point within a given period of time.
Français: Euro
Bons du Trésor
Español: Eurobonos
de tesorería
Exchange: The marketplace within which shares, options and futures on stocks, bonds, commodities and indices are traded. Some of the main world exchanges include the New York Stock Exchange (NYSE), the National Association of Securities Dealers Automatic Quotation System (NASDAQ), the LIFFE, etc.
Français: Echange
Español: Bolsa,
bolsa de valores
Exchange permit: A government permit sometimes required in order to convert domestic currency into a foreign currency, for payment of international transactions.
Français: Permis de
change
Español: Permiso
de cambio de divisas
Exchange controls: Restrictions applied by a government (or the Central Bank) to limit the convertibility of the local currency into foreign currencies.
Français: Contrôle
des changes
Español: Control
de cambios, control cambiario, intervención de los cambios
Exchange rate: The price at which one currency can be converted into another. On foreign exchange markets there are two reference exchange rates: the Bid rate (at which operators are willing to buy the currency in exchange for another) and the asked rate (at which they are willing to sell the currency against another). Freely traded currencies also have a spot rate for immediate exchange and a forward rate for exchanges to be carried out at some future date.
Français: Taux de change
Español: Tipo de cambio
Exchange risk coverage: A general term for financial techniques (such as insurance, swaps, forwards etc.) intended to cover (protect) the enterprise from adverse variations in the exchange rate (e.g. from the depreciation of the currency of denomination of a credit).
Français: Couverture du risque de change
Español: Cobertura
de los riesgos cambiarios, cobertura de los riesgos de fluctuación de los tipos de cambio
Ex dividend: i.e. without dividend. A share sold "ex div" does not entitle the purchaser to the forthcoming dividend payment. Opposite: Cum div.
Français: Ex-dividende
Español: Sin dividendo
Ex: i.e. "from". When used in pricing terms such as "ex factory" or "ex dock" it indicates that the quoted price refers to the goods at their point of origin (in the examples, respectively at the seller's factory or the export dock). In practice, this kind of quotation indicates that the goods are made available to the buyer at a specified place within a fixed period time.
Exercise price: See Strike price.
Français: Prix
d'exercice
Español: Exercise price
EXIMBANK: See Export-Import Banks.
Français: EXIMBANK
Español: EXIMBANK
Exotics: Derivatives which are either complex and sophisticated or are available in emerging economies. They contrast with "plain vanilla" derivatives, which relate to standard commodities in industrialised countries which are relatively simple.
Français: Exotiques
Español: Complejo
Expiration date: The time when the contract ceases to exist. In the case of a letter of credit, it indicates the last date upon which draft(s) may be presented for negotiation. When referring to an option this is the last day (on an American basis) or the only day (on a European basis) on which the option may be exercised.
Français: Date d'échéance
Español: Fecha de vencimiento, fecha de
caducidad
Export Administration Regulations: Regulations which provide specific instructions as to the type of export licenses required, their use and the goods under export control.
Français: Règlements administratifs
d'exportation
Español: Reglamentación para
la gestión de las exportaciones
Export Broker: An individual, or a firm, who brings together international buyers and sellers for a fee, without however taking part in the actual sales transactions.
Français: Courtier
à l'exportation
Español: Agente de
exportaciones
Export Control Classification Number
(ECCN): A number assigned to every product on the Commerce Control List. The ECCN consists of a five-character number which identifies the category, product group, strategic level of control and country group level of control.
Français: Numéro de
classification de contrôle à l'exportation
Español: Número de
clasificación para el control de las exportaciones
Export credit: A term covering different export financing facilities ensuring the availability of credit to the exporter at an acceptable rate of interest. Such facilities are usually intended to meet the exporter's pre/post shipment credit requirements and include the refinancing of suppliers/buyers' credit.
Français: Crédit
à l'exportation
Español: Crédito
a la exportación
Export Credit Agency (ECA): A governmental, semi-governmental or private agency established with the aim of facilitating exports through the provision of insurance, guarantees and/or funding or funding support.
Français: Agence de crédit à l'exportation
Español: Organismo de crédito a la
exportación (OCE)
Export Credit Enhanced Leverage (EXCEL):
A programme developed in 1990 by the World Bank in conjunction with a working group of the International Union of Credit and Investment Insurers (the Berne Union). The programme’s goal is to provide export credits at Consensus rates to private sector borrowers in highly indebted countries, which would be a too great a risk for most agencies to take on.
Français: Export Credit Enhanced Leverage
(EXCEL)
Español: Programa de
Fomento del Crédito a la Exportación (EXCEL)
Export credit guarantee: A guarantee issued by a financial institution (frequently a government agency) especially set up to safeguard export-financing banks against losses resulting from the export transactions they finance. It therefore facilitates exporters' access to pre/post shipment credit from a banking institution and is thus a powerful incentive to exporting. It should be noted that export credit guarantees do not involve the actual provision of funds to exporters.
Français: Garantie de crédit à l'exportation
Español: Garantía de crédito a la
exportación
Export credit insurance: A policy to cover some of the riskier areas faced by exporters i.e. non- payment due either to insolvency of the importer (commercial risk) or political events (political risk). Export credit insurance is frequently mentioned in connection with export credit guarantees. While guarantees cover bank export loans, insurance policies are issued directly in favour of the exporters. In many developing countries this type of insurance is either not available or is too expensive. Several types of export credit insurance are available. These differ from country to country according to the needs of the local business community. The most widely used types of export credit insurance include the following:
(1) Short-term export credit insurance: generally covers credit periods not exceeding 180 days. Pre-shipment and post-shipment export stages are covered and protection may be provided against political and commercial risks.
(2) Medium- and long-term export credit insurance: issued for credits extending for periods over 12 months. It provides cover for exports of capital goods, construction or special services.
(3) Investment insurance: issued to companies investing in foreign countries. The Multilateral Investment Guarantee Agency (MIGA), affiliated to the World Bank, offers this type of insurance.
(4) External trade insurance: applies to goods not shipped from the originating country. It is not available in a number of developing countries.
(5) Exchange risk insurance: covers losses arising from the fluctuation of the respective exchange rates of the importer's and exporter's national currencies over a determined period of time.
Français: Garantie de crédit à l'exportation;
Assurance de crédit à
l'exportation
Español: Seguro de crédito a la exportación
Export credit linked swaps: The difference between the market interest rates of a specific currency and the minimum interest matrix rates prescribed under the OECD's Arrangement on Guidelines for Officially Supported Export Credits (the Consensus) may be used to reduce the costs of financing a transaction. The currency usually used for such export credits is the dollar. Under this technique, the export credit is extended in the normal way and the official agency subsidizes it, to bring the cost of credit into line with the Consensus minima. In a separate transaction, a swap is arranged to transfer the subsidy element from the dollar credit into another currency and thus reduce the cost of funds to the borrower. The differential between the Consensus rates and market rates will determine the reduction in the costs of financing.
Français: Swaps liés à des crédits à
l'exportation
Español: Swap para crédito a la exportación
Export declaration: Also known as the shipper's export declaration (SED), this is a document describing the complete particulars of a specific shipment. It is required by the Department of Commerce in order to control exports and for statistical purposes.
Français: Déclaration
d'exportation
Español: Declaración de expedición del
cargador
Export financing: The extension to exporters of the funds required to carry out the export of merchandise or for the rendering of services, such as construction, engineering and development projects in a foreign country. Export financing usually takes the form of a bank credit granted directly to the exporter or of a credit extended to foreign importer. An important role in short-term export financing is played by documentary credit.
Français: Financement
à l'exportation
Español: Financiación
de exportaciones
Export-Import banks (EXIMBANKS): These are banks specialised in lending to support international trade transactions. They are created to support the development of exports and to satisfy the financial needs of exporters and importers, as well as of investors in foreign markets. This is achieved by supplementing and fostering the financing of their country's foreign trade by commercial banks and other private institutions. Eximbanks offer four major export finance support programmes: loans (pre-shipment and post-shipment financing), guarantees, working capital guarantees and insurance. The Export-Import bank of the United States is the ECA of the United States.
Français: Banques
d'export-import
Español: Banco de exportación e importación
Export license: A government document allowing the "licensee" to engage in the export of specific goods in determined quantities to a particular destination. Some countries may require this document for most or all exports, while others will ask for it only under special circumstances.
Français: Licence
d'exportation
Español: Licencia
de exportación
Export Management Company (EMC): A private firm which buys merchandise from domestic manufacturers for international distribution or which sometimes acts as an agent for manufacturers. It may act as the export department for many different manufacturers, soliciting and transacting export business on their behalf in return for a commission, salary or retainer.
Français: Société de gestion des exportations
Español: Compañía de gestión de
exportaciones
Export merchant: A company which buys products directly from the manufacturers and then packages and adds its brand to them, for resale under its own name.
Français: Exportateur
Español: Negociante
exportador
Export oriented strategy: An economic strategy assigning a key role to the production of goods for export as a means of encouraging the development of the domestic industry. Compare with import substitution.
Français: Stratégie orientée à l'exportation
Español: Export
oriented strategy
Export Processing Zone (EPZ): Industrial parks, designated by a government to provide tax and other incentives to firms, located within the parks, which manufacture exclusively for the export market.
Français: Zones de traitement des exportations
Español: Zona
franca industrial, zona de elaboración (de productos) para la exportación
Export quotas: Restrictions or target objectives imposed by the government of the exporting country on the value or volume of exports of specified goods. Such restrictions may be intended to protect domestic producers and consumers from temporary shortages of certain materials, or as a means of moderating world prices of specified commodities.
Français: Quotas à
l'export
Español: Continente
de exportación
Export risk guarantee: A safeguard against potential claims arising from export operations.
Français: Garantie de risque à l'exportation
Español: Garantía contra los riesgos
de exportación
Export subsidies: These usually take the form of direct government payments or other economic incentives to domestic producers of goods sold on foreign markets. The General Agreement on Tariffs and Trade (GATT) has imposed restrictions on the extension of such subsidies, in view of their potential to distort trade, unduly disturb normal commercial competition and hinder the achievement of the GATT fair trade objectives.
Français: Subventions
à l'exportation
Español: Subvenciones
a la exportación
Export tariff: A tax on goods exported from a country.
Français: Tarif
d'exportation
Español: Derechos de exportación,
arancel de exportación
Export trading company: A company which is legally allowed to become involved in international trade.
Français: Société commerciale d'exportation
Español: Sociedad
exportadora
Exposure: The total amount of outstanding credit owed by a borrower or a country.
Français: Encours
Español: Préstamos
pendientes
(Country) exposure: the amount of outstanding credit extended towards a specific country by a bank, group of banks or export credit agencies, including commitments, arrears and unrecovered claims. It is thus a measure of the possible total financial cost to the agency in case of default by the borrowing country.
Français: Encours
d'un pays
Español: Préstamos
pendientes por país
Expropriation risk: See Political risk.
Français: Risque
d’expropriation
Español: Riesgo de
expropiación
Extended fund facilities: A special fund of the International Monetary Fund (IMF), available to assist members who need to undertake structural adjustments programmes. The facilities take the form of medium-term loans and are granted to countries qualifying for support. These countries may draw from the facility in tranches, where the availability of each tranche depends on the achievement of certain economic targets agreed in advance with the IMF.
Français: Facilités de financement étendues
Español: Servicio
ampliado del Fondo
Extension: An additional period which may be granted by the drawer for payment of a draft when the drawee is unable or unwilling to make the due payment at the agreed maturity date.
Français: Prolongation
Español: Prórroga,
prolongación
Ex works (EXW): This stands for "at a named point of origin" (e.g. ex factory, ex mill, ex warehouse). Under this term, the quoted price refers to the goods at the point of origin only and the seller agrees to place the goods at the disposal of the buyer at the specified place, on the date or within the period fixed. All other charges are to the account of the buyer.
Français: Ex works (EXW)
Español: Franco fábrica
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