Abbreviations in Banking Sector

Abbreviations in Banking Sector

A

ALM – Asset and Liability Management
ALM is a mechanism to manage the risk faced by a bank due to a mismatch between assets and liabilities.

AMFI – Association of Mutual Funds of India
AMFI is a financial organization for the development of the Indian Mutual Fund Industry on professional & noble lines to improve and maintain standards in every area with a view to protect and promote the interests of
mutual funds and their unitholders.

ASBA– Applications Supported by Blocked Amount
ASBA is a method promoted by Indian Stock Market Regulator SEBI for applying to IPO [Initial Public Offering – IPO is a process by which a private company becomes a public company]. In ASBA, an IPO applicant’s account
doesn’t get debited until shares are allotted to them)

ASSOCHAM– Associated Chambers of Commerce of India
ASSOCHAM represents the interests of trade and commerce in India

 

B

BCSBI – Banking Codes and Standards Board of India
BCSBI is an autonomous banking industry that protects & observes the different banking codes & standards adopted by the Indian Banking system.

BIS-Bank for International Settlement
The mission of the BIS is to serve central banks in their pursuit of monetary and financial stability, to foster international cooperation in those areas and to act as a bank for central banks.

BPLR– Benchmark Prime Lending Rate
BPLR is the lending rate at which commercial banks charge their customers who are most creditworthy, Nowadays Base rate is used as the lending rate as it is most transparent.

 

C

CAD – Current Account deficit
Current account deficit is a determination of a country’s trade when the value of the goods and services imported exceeds the value of the goods and services it exported.

CAMELS
C – Capital Adequacy

A – Assets

M – Management Capability

E – Earnings

L – Liquidity

S – Sensitivity

CAMELS rating is a supervisory rating system originally developed in the U.S. to classify a bank’s overall condition.

CASA – Current Account & Saving Account

CCEA –Cabinet Committee on Economic Affairs
CCEA is a standing committee constituted by the government of India, CCEA reviews and directs economic activities in the country.

CDR – Corporate Debt Restructuring
In 2002, RBI launched CDR scheme to help banks recover debts from distressed borrowers which are not able to pay back loans on time. It helps recover by changing the structure and maturity date of the repayments.

 

CDS – Credit Default Swap
An agreement between two parties to exchange the credit risk of an issuer reference entity. The buyer usually pays a periodic fee and profits if the reference entity has a credit event, or if the credit worsens while the swap is outstanding. The seller collects the periodic fee and profits if the credit of the reference entity remains stable or improves while the swap is outstanding.

CEPA – Comprehensive Economic Partnership Agreement
CECA involves only tariff reduction/elimination in a phased manner on listed/all items except the negative list and tariff-rate quota (TRQ) items along with the Free trading, Services and investments.

Note – A tariff-rate quota (TRQ) is a trade policy tool used to protect a domestically-produced commodity or product from competitive imports.

CECA – Comprehensive Economic Cooperation Agreement
CECA involves only tariff reduction/elimination in a phased manner on listed/all items except the negative list and tariff-rate quota (TRQ) items.

 

CIBIL – Credit Information Beuro of India Limited

CIBIL Limited is a credit information company operating in India. It maintains credit files on 600 million individuals and 32 million businesses.

CRISIL – Credit Rating & Investment Services of India Limited
CRISIL is a global analytical company providing ratings, research, and risk and policy advisory services.

E

ECBs – External Commercial Borrowings
ECB are loans in India made by non-resident lenders in foreign currency to Indian borrowers. They are used widely in India to facilitate access to foreign money by Indian corporations and PSUs (public sector undertakings).

 

EFSF – European Financial Stability Network
Financial Risk and Stability Network is an independent non-profit organization based in Berlin focusing on regulation, financial stability and financial sector reforms in the EU.

 

F

FEMA – Foreign Exchange Management Act
FEMA is an Act of the Parliament of India to consolidate and amend the law relating to foreign exchange with the objective of facilitating external trade and payments and for promoting the orderly development and maintenance
of the foreign exchange market in India.

 

FERA – Foreign Exchange Regulatory Act
FERA was legislation passed in India in 1973 that imposed strict regulations on certain kinds of payments, the dealings in forex & securities and the transactions which had an indirect impact on the foreign exchange and the
import and export of currency

 

FII – Foreign Institutional Investor
FII is mostly involved with portfolio investment. They are registered foreign institutional bodies with the country’s regulator who buys stocks and bonds in the country.

 

FIMMDA – Fixed Income Money Markets & Derivative Association

FIMMDA is an association of Scheduled Commercial Banks, Public Financial Institutions, Primary Dealers and Insurance Companies was incorporated as a Company under section 25 of the Companies Act, 1956 on May 4th, 1998. FIMMDA is a voluntary market body for the bond, money and derivatives markets.

 

FINO – Financial Inclusion Network Operation

It is the leading banking organization that offers different banking services to its customer.

 

FPI – Foreign Portfolio Investment.

If a foreign company invests/holds less than or equal to 10% total holdings of a listed Indian company then we call it as FPI.

G

GNP – Gross National Product.
Total Product and Services produced by the residents of the country in a year.

H

HDFC – Housing Development & Financial corporations
HDFC is the largest private sector bank in India

I

IBA – Indian Bank Association
The representative body of administration of banking in India which is operated in India – An association of Indian banks and financial institutions based in Mumbai.

IBRD – International Bank for Reconstruction & Development
IBRD is the part of World Bank that provides loan to an average developing country.

ICICI – Industrial Credit & Investment Corporation of India
One of the largest private sector banks in India

 

ICRA – Indian Credit Rating Agency
ICRA Limited is an Indian autonomous and adept investment information and credit rating agency. It was established in 1991.

 

InvITS – Infrastructure Investment Trust
The objective of InvITs is to facilitate investment in the infrastructure sector. It works like mutual funds. InvITs does the investment of small amounts of money from possible individual/institutional investors in infrastructure to earn
a small portion of the income as a return.

 

L

LIBOR – London Inter-bank Offered Rate
LIBOR is the average interest rate estimated by leading banks in London that they would be paying if they borrow from other banks.

 

M

MIBID – Mumbai Inter-Bank Bid Rate
MIBID is the rate at which banks would like to borrow from other banks.

MIBOR – Mumbai Inter-bank Offered Rate
MIBOR is the interest rate at which banks are willing to lend funds, in marketable size, from other banks in the Indian interbank market. MIBOR is calculated every day by the National Stock Exchange of India (NSEIL) as a
weighted average of lending rates of a group of banks, on funds lent to first-class borrowers.

N

NEFT- National Electronic Fund Transfer
National Electronic Funds Transfer (NEFT) NEFT is an electronic funds transfer method, which helps to transfer money to other bank accounts over the country

 

NDTL- Net Demand & Time Liabilities
Bank accounts from which you can withdraw your money at any time are called “Demand Liabilities” for exemplification, Savings accounts, Current Deposits etc. Accounts from which you can’t just withdraw money at any time but you have to wait for a certain period are called Time Liabilities, for instance, Fixed Deposits, cash certificates etc.

 

NASDAQ – National Street Dealers Automated Quotations
NASDAQ is World’s 2nd largest stock exchange located in New York U.S

 

NAV – Net Asset Value
Net Asset Value, or NAV, is the sum total of the market value of all the shares held in the portfolio NAV = (Value of Assets-Value of Liabilities)/number of units outstanding.

O

OLTAS – Online Tax Accounting System
It is a system used for the collection of direct taxes from relevant individuals as well as companies or organizations.

P

PSB – Public Sector Banks
PSB banks are those banks whose Majority of stakes are owned by the central government

 

PPP- Purchasing Power Parity
Purchasing power parity (PPP) is an economic consideration that states that the transfer rate within two currencies is equivalent to the ratio of the currencies ‘ corresponding purchasing power.

 

PIN- Personal Identification Number

 

Q

 

QFI- The Qualified Foreign Investor.
QFI is sub-category of Foreign Portfolio Investor and refers to any foreign individuals, groups or associations, or resident, however, restricted to those from a country that is a member of Financial Action Task Force (FATF) or a country that is a member of a group which is a member of FATF and a country that is a signatory to International Organization of Securities Commission’s (IOSCO) Multilateral Memorandum of Understanding (MOU).

R

REIT’s – Real Estate Investment Trusts
REIT is an organization registered with SEBI that invest in commercial rent-generating real estate assets.

S

SARFAESI- Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest
Banks utilize this law as a practical tool for the recovery of bad loans (NPA). It is possible where non-performing assets are backed by securities i.e. Applicable for only secured loan.

SENSEX- Sensitive Index
Sensex is one of the indices of the Indian stock market.

SWOT –
Strength
Weakness
Opportunity
Threats

SWIFT – Society for Worldwide Interbank Financial Telecommunication.
SWIFT is code which is used to transfer money overseas.

T

TIN – Tax Information Network
Tax Information Network (TIN) is an initiative by Income Tax Department of India (ITD) for the modernization of the current administration of collection, processing, monitoring & accounting of direct taxes using information technology.

 

TAPI – Turkmenistan, Afghanistan, Pakistan, India
TAPI also is known as Trans-Afghanistan Pipeline, is a natural gas pipeline being promoted by the Galkynysh –TAPI Pipeline Company Limited with the association of the Asian Development Bank.

 

TIEA – Tax Information Exchange Agreement

TIEA provides for the exchange of information on request relating to a specific criminal or civil tax investigation or civil tax matters under investigation. The purpose of this Agreement is to promote international co-operation in tax matters through exchange of information

U

UIDAI – Unique Identification Authority of India
UIDAI gives identity to all the residents of India to make public services effective.

W

WMA’s – Ways & Means Advances (WMA) is a tool adopted by Reserve Bank of India (RBI) under the credit policy that grants to the States banking with it to help them to tide over unstable mismatches in the cash flow of their receipts and payments.

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