rediscounting


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Rediscount

To declare a discount for the second time. For example, an issuer may offer a bond at a discount from its par value to entice investors. If this does not work, the issuer may discount the bonds further in order to encourage people to buy the bond.

rediscounting

the secondary purchase and sale of BILLS OF EXCHANGE, TREASURY BILLS and BONDS between their original issue and final redemption. When a bill of exchange is first issued it is usually purchased (i.e. ‘discounted’) by a DISCOUNT HOUSE. The discount house may hold on to the bill until maturity, or it may choose to on-sell it to another discount house, in which case the bill is then ‘rediscounted’.

For example, if a bill with a face value of £1,000 redeemable in one year's time is sold initially for £900 (giving a £100 discount on its formal redemption value), then it might be resold or rediscounted for £950 after six months. See DISCOUNT, DISCOUNT MARKET.

rediscounting

the purchase and sale of BILLS OF EXCHANGE, TREASURY BILLS and BONDS between their issue and redemption dates. For example, if a bond with a nominal value of £1,000 redeemable in one year's time is sold initially for £900 (giving a £100 discount on its formal redemption value), then it might be resold or rediscounted for £950 after six months. See also DISCOUNT, DISCOUNT MARKET.
References in periodicals archive ?
1Rediscounting is a BSP credit facility extended to qualified banks with active rediscounting lines to meet their temporary liquidity needs by refinancing the loans they extend to their clients using the eligible papers of its end-user borrowers.
Commercial credits resulting from the importation, exportation, purchase of non-perishable and insured goods or products in Monetary Board-approved storage facilities cornered 35.48 percent of the total rediscounting loans.
These rediscounting loans represented borrowings against banks' credits on transactions related to commercial, production and "other credits."
Furthermore, the Court said De Leon committed another dishonesty when he did not truthfully disclose the actual rate of interest earned from the rediscounting business of Mendoza.
In 2013, reforms were made to bring the BSP Peso rediscounting policies in line with its lender-of-last-resort function through Circular No.
The rediscounting facility enables banks to borrow from the Bangko Sentral ng Pilipinas, using its borrowers eligible papers as collateral.
Foreign investors appreciated the preemptive liquidity measures implemented by the central bank on the onset of the global downturn like the 200 basis points cut in the central bank rates, the increase in the central bank's rediscounting rates, and the opening of a dollar rediscounting rates.
The benefit to size is somewhat larger and the negative effect of financing assets by rediscounting paper is significantly stronger.
McAdoo also backed compulsory rediscounting among Federal Reserve banks since this would promote a flow of currency and credit.
One of the original purposes of the Federal Reserve Act, for example--"to afford means of rediscounting commercial paper"--sounds as foreign to my ears today as "asymmetric directive" or "electronic payments" would have sounded to the Atlanta Fed's first president (then called governor), Joseph McCord, early in the last century.
Most members of the Board, and officials of some Reserve Banks, believed that Federal Reserve credit should be extended only at the initiative of member commercial banks through the rediscounting of commercial and agricultural loans.