banker's acceptance


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Banker's acceptance

A short-term credit investment created by a nonfinancial firm and guaranteed by a bank as to payment. Acceptances are traded at discounts to face value in the secondary market. These instruments have been a popular investment for money market funds. They are commonly used in international transactions.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

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.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

banker's acceptance

A short-term credit instrument created by a nonfinancial firm and guaranteed by a bank as to payment. Acceptances are traded at discounts from face value in the secondary market on the basis of the credit quality of the guaranteeing banks. These instruments have become a popular investment for money market funds. Also called acceptance.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
References in periodicals archive ?
B[A.sub.s] = Banker's acceptance (naira values) as a %age of GDP at current market price.
Letter of credit - time basis (60 days after sight) with banker's acceptances
Margin deposits paid by banks' clients will have to be included in reserves to the central bank to secure issuance of banker's acceptance, letters of guarantee and letters of credit.