Documented discount notes

Commercial paper backed by normal bank lines of credit plus a letter of credit from a bank stating that it will pay off the paper at maturity if the borrower defaults. Such paper is also referred to as L.O.C. paper. Also known as Bankers' Acceptances.

Banker's Acceptance

Short-term debt obligations that are secured by banks. That is, a bank promises to pay a creditor if a borrower defaults. It is also called a documented discount note.

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