Chapter 33 Flashcards
What are investment banks
They deal with projects, bonds, placements. They deal in corporate issues. They are different from commercial banks.
What is the common criteria of issuance of loan by banks
Checking of assets
What are 2 types of assets
1- Tangible assets (can be cash by selling)
2- Intangible assets (e.g. intellectual property rights, goodwill)
What are types of bank loans
- Long term loans
- Short term loans
- Loan against machinery
- Loan against LC
- Inventory loan
- equipment loan
What are accounts receivable loan
Its a loan that is given in market as credit. e.g. printing market is on credit.
What is invoicing discount
Invoice discounting is the practice of using a company’s unpaid accounts receivable as collateral for a loan, which is issued by a finance company/bank.
What is factoring
In invoice discounting, if loan is not given bank to a person, who will responsible. In this situation, bank do factoring and take responsibility of it.
What is inventory loan
Loan on inventory. Its example is finish goods or raw material. Raw material is that which is sustainable.
What is equipment loan
Loan on equipment
What is leasing
Bank paid for something for customer and customer pay back to bank in fixed tenure by installments.
What is real estate loan
Loan on property by pledging it
What are 2 methods for selling property and evaluating its price
1- Selling it immediately
2- Selling it by planning
What is nec
nec is checking property that it is clear for any mishap. Bank do that.
What is cash flow financing
Its a kind of loan in which, an amount is available to take as cash. But consumer can withdraw amount of its own choice. The interest is based on withdrawal money and there is a fixed tenure for interest. Its example is ready cash.
What are installment loan
Pay back money in installment or pay it back at once too
