TOPIC 7 Flashcards
Bond
Bonds are issued by governments and corporations when they want to raise money. By buying a bond, you’re giving the issuer a loan, and they agree to pay you back the face value of the loan on a specific date, and to pay you periodic interest payments along the way, usually twice a year.
Chancellor of the exchequer
The British Cabinet minister responsible for financial and economic matters and in charge of the Treasury.
Common bond
An interest or circumstance shared by a group of people, for example working for the same employer or living in a certain
area.
Communication channel
The medium through which information is transferred to its intended recipient, e.g email or telephone. In financial services, it
refers to the way a customer can contact their provider and manage their account. It is also referred to as a distribution channel.
Demutualisation
A mutual organisation (building society) becomes a bank.
Dividends
A payment of profits from a company to its shareholders.
Insurance
Products that give financial protection against certain events.
Interest rate margin
The difference between the interest rate that a bank charges on borrowing products and the interest rate that it pays on savings.
Premium Bonds
A lottery bond, issued by NS&I, entered into a monthly prize draw with tax-free prizes or ‘premiums’. Bonds must be held for a full calendar month after the month in which they were purchased.
Savings bonds
A savings product held for a fixed period, e.g two years. There are rules about when you can and can’t withdraw money.
Treasury
Her Majesty’s (HM) Treasury, the government department responsible for development and implementation of financial and economic policy.
PRA (Prudential regulation authority)
The PRA is responsible for micro-prudential
regulation – this involves looking at the risk that individual providers might present to the stability of the financial services market.
FCA (Financial conduct authority)
he FCA is responsible for ensuring that all providers conduct their businesses in a way that benefits consumers and the market as a whole.
