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Treasury Terms ABA: American Bankers Association. National trade and professional association serving the entire banking community, from small community banks to large bank holding companies.++ ACH: An Automated Clearing House transaction that involves the transfer of funds to or from a receiver’s account to or from a receiver’s account BAI: Bank Administration Institute. Professional institute devoted to improving the competitive position of financial services companies through education and research.+ CHAPS: Clearing House Automated Payment System. A U.K.-based payment system for high-value, same-day settlement of transactions Check conversion: The conversion of a check to an electronic debit or image of the check. This check image serves as the official record.****** CHIPS: An independent message switching system that permits international financial transactions to be settled among New York banks. CHIPS is operated by the New York Clearing House Association. CP: Commercial paper. Unsecured promissory notes that companies issue to finance short-term capital needs with a maturity of 270 days or less. EFT: Electronic Funds Transfer. The movement of funds by non-paper means (i.e. electronically), usually through a payment system such as the ACH network or Fedwire. Endowment: the act of donating assets or funds with a permanent source of income**** Endowment - Permanent: A permanent fund bestowed upon an individual or institution, such as a university, museum, hospital, or foundation, to be used for a specific purpose.*** Endowment - Quasi: A type of endowment which allows principal and interest to be expended, while still retaining the original spirit of long-term investment.** Fedwire: The same-day value electronic funds transfer system operated in the U.S. by the Fed. FX: Foreign Exchange Rate. The equivalent number of units of one currency per unit of a different currency. LOC or L/C: Letter of credit. A document issued by a bank guaranteeing the payment of a customer’s draft up to a stated amount for a specific period, provided that specified terms and conditions are met. Lockbox: A collection system in which a bank or a third party receives, processes and deposits a company’s mail receipts. Also known as a lockbox processor. NSF: Not sufficient funds. A bank check having insufficient funds to back it. RFP: Request for proposal. An official request or format used to facilitate selection of a service or goods provider. SWIFT: The Society for Worldwide Interbank Financial Telecommunication ('SWIFT') runs a worldwide network by which messages concerning financial transactions are exchanged among banks and other financial institutions. As of December 2001 it linked over 7,000 financial institutions in 194 countries and estimates that it carries payment messages averaging more than six trillion US dollars per day.++++ Term: a fixed amount of time usually given to repay a loan ZBA: Zero Balance Account. A disbursement bank account on which checks are written even though the balances in the accounts are maintained at zero. Debits are covered by a transfer of funds from a master account at the same bank. * |
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