Back-end loan fund

Similar financial terms

Back-end value
The amount paid to remaining shareholders in the second stage of a two-tier or partial tender offer.

Variable rate loan
Loan made at an interest rate that fluctuates based on a base interest rate such as the Prime Rate or LIBOR.

Transaction loan
A loan extended by a bank for a specific purpose. In contrast, lines of credit and revolving credit agreements involve loans that can be used for various purposes.

Term loan
A bank loan, typically with a floating interest rate, for a specified amount that matures in between one and ten years and requires a specified repayment schedule.

Self-liquidating loan
Loan to finance current assets, The sale of the current assets provides the cash to repay the loan.

Savings and Loan association
A US-type state-chartered institution that accepts savings deposits and invests the bulk of the funds thus received in mortgages.

Project loans
Usually FHA-insured and HUD-guaranteed mortgages on multiple-family housing complexes, nursing homes, hospitals, and other development types.

Project loan securities
Securities backed by a variety of FHA-insured loan types - primarily multi-family apartment buildings, hospitals, and nursing homes.

Project loan certificate (PLC)
A primary program of Ginnie Mae for securitizing FHA-insured and coinsured multifamily, hospital, and nursing home loans.

Parallel loan
A process whereby two companies in different countries borrow each other's currency for a specific period of time, and repay the other's currency at an agreed maturity for the purpose of reducing foreign exchange risk. Also referred to as back-to-back loans.

Multifamily loans
Loans usually represented by conventional mortgages on multi-family rental apartments.

Multicurrency loans
Give the borrower the possibility of drawing a loan in different currencies.

Loan value
The amount a policyholder may borrow against a whole life insurance policy at the interest rate specified in the policy.

Loan syndication
Group of banks sharing a loan.

Loan amortization schedule
The schedule for repaying the interest and principal on a loan.

Back-to-back loan
A loan in which two companies in separate countries borrow each other's currency for a specific time period and repay the other's currency at an agreed upon maturity.

Builder buydown loan
A mortgage loan on newly developed property that the builder subsidizes during the early years of the development. The builder uses cash to buy down the mortgage rate to a lower level than the prevailing market loan rate for some period of time. The typical buydown is 3% of the interest-rate amount for the first year, 2% for the second year, and 1% for the third year (also referred to as a 3-2-1 buydown).

Bullet loan
A bank term loan that calls for no amortization.

Federal Home Loan Bank Act of 1932
Law that created the Federal Home Loan Bank Board and a network of regional home loan banks.

Federal Home Loan Bank Board (FHLBB)
The FHLBB is an agency responsible for regulating and controlling savings and loan institutions, superseded by FIRREA in 1989.

Bridging Loan
A short-term loan that acts as a bridge for the borrower until the borrower obtains a medium or long-term loan to replace it. (Commonly used to finance the purchase of a new house whilst awaiting the proceeds from the sale of a previous property).

Federal funds rate
The rate charged by the Federal Reserve to member banks when excess reserve loans are made from one bank to another.

Fundamental analysis
A method of research that studies basic financial information to forecast profits, supply and demand, industry strength, management ability, and other intrinsic matters affecting a stock's market value and growth potential.

Annual fund operating expenses
For investment companies, the management fee and "other expenses," including the expenses for maintaining shareholder records, providing shareholders with financial statements, and providing custodial and accounting services. For 12b-1 funds, selling and marketing costs are included.

Unfunded debt
Debt maturing within one year (short-term debt).

Underfunded pension plan
A pension plan that has a negative surplus (i.e., liabilities larger than assets).

Two-fund separation theorem
The theoretical result that all investors will hold a combination of the risk-free asset and the market portfolio.

Term Fed Funds
Federal funds sold for a period of time longer than overnight.

Surplus funds
Cash flow available after payment of taxes in the project.

Stopping curve refunding rate
A refunding rate that falls on the stopping curve.

Sinking fund requirement
A condition included in some corporate bond indentures that requires the issuer to retire a specified portion of debt each year. Any principal due at maturity is called the balloon maturity.

Single country fund
A mutual fund that invests in individual countries outside the United States.

Revenue fund
A fund accounting for all revenues from an enterprise financed by a municipal revenue bond.

Regional fund
A mutual fund that invests in a specific geographical area overseas, such as Asia or Europe.

Refunding
The redemption of a bond with proceeds received from issuing lower-cost debt obligations ranking equal to or superior to the debt to be redeemed.

Refunded bond
Also called a prerefunded bond, one that originally may have been issued as a general obligation or revenue bond but that is now secured by an "escrow fund" consisting entirely of direct U.S. government obligations that are sufficient for paying the bondholders.

Refundable
Eligible for refunding under the terms of indenture.

Pure index fund
A portfolio that is managed so as to perfectly replicate the performance of the market portfolio.

Purchase fund
Resembles a sinking fund except that money is used only to purchase bonds if they are selling below their par value.

Private Export Funding Corporation (PEFCO)
Company that mobilizes private capital for financing the export of big-ticket items by US firms by purchasing at fixed interest rates the medium- to long-term debt obligations of importers of US products.

Overfunded pension plan
A pension plan that has a positive surplus (i.e., assets exceed liabilities).

Open-end fund
Also called a mutual fund, an investment company that stands ready to sell new shares to the public and to redeem its outstanding shares on demand at a price equal to an appropriate share of the value of its portfolio, which is computed daily at the close of the market.

Objective (mutual funds)
The fund's investment strategy category as stated in the prospectus. There are more than 20 standardized categories.

Nonrefundable
Not permitted, under the terms of indenture, to be refundable.

No-load fund
A mutual fund that does not impose a sales commission.

No load mutual fund
An open-end investment company, shares of which are sold without a sales charge. There can be other distribution charges, however, such as Article 12B-1 fees. A true "no load" fund will have neither a sales charge nor a distribution fee.

Net advantage of refunding
The net present value of the savings from a refunding.

Mutual fund theorem
A result associated with the CAPM, asserting that investors will choose to invest their entire risky portfolio in a market-index or mutual fund.

Mutual fund
Mutual funds are pools of money that are managed by an investment company. They offer investors a variety of goals, depending on the fund and its investment charter. Some funds, for example, seek to generate income on a regular basis. Others seek to preserve an investor's money. Still others seek to invest in companies that are growing at a rapid pace. Funds can impose a sales charge, or load, on investors when they buy or sell shares. Many funds these days are no load and impose no sales ch ...

Money market fund
A mutual fund that invests only in short term securities, such as bankers' acceptances, commercial paper, repurchase agreements and government bills. The net asset value per share is maintained at $1. 00. Such funds are not federally insured, although the portfolio may consist of guaranteed securities and/or the fund may have private insurance protection.

Match fund
A bank is said to match fund a loan or other asset when it does so by buying (taking) a deposit of the same maturity. The term is commonly used in the Euromarket.

Low-coupon bond refunding
Refunding of a low coupon bond with a new, higher coupon bond.

Load fund
A mutual fund with shares sold at a price including a large sales charge -- typically 4% to 8% of the net amount indicated. Some "no-load" funds have distribution fees permitted by article 12b-1 of the Investment Company Act; these are typically 0. 25%. A "true no-load" fund has neither a sales charge nor Freddie Mac program, the aggregation that the fund purchaser receives some investment advice or other service worthy of the charge.

Liability funding strategies
Investment strategies that select assets so that cash flows will equal or exceed the client's obligations.

Balanced fund
An investment company that invests in stocks and bonds. The same as a balanced mutual fund.

Balanced mutual fund
This is a fund that buys common stock, preferred stock and bonds. The same as a balanced fund.

Closed-end fund
An investment company that sells shares like any other corporation and usually does not redeem its shares. A publicly traded fund sold on stock exchanges or over the counter that may trade above or below its net asset value.

Cost of funds
Interest rate associated with borrowing money.

Sinking fund
A sinker is a fund created by a provision in many bond contracts that requires the issuer to set aside each year a portion of the final maturity payment so that investors can be certain that the funds will be available at maturity.

Private Equity Fund
A fund that buys majority stakes in companies and/or entire business units to restructure its capital, management and organization. Usually the targets are delisted (unless already unlisted), held private and restructured over a period of 3-7 years, and then again listed through an IPO.

Restructuring may be done through leveraged buyouts, venture capital, growth capital, angel investing, mezzanine debt, management share participation programmes and others.

Big players in th ...

Mutual Fund Switching Privileges
Allow an investor to switch out of and into a different fund(s) within the same family of funds at very low or no compensation.

Segregated Funds
These funds guarantee that, regardless how the fund performs, at least a minimum percentage (usually 75 per cent or more) of the investor's payments into the fund will be returned when the fund matures.

Sinking Fund
A method whereby a company purchases a given percentage of its bonds or shares as per agreement in the trust indenture or prospectus. This provides the investor with some degree of liquidity, knowing that the company must purchase shares each year.

Specialty fund
A mutual fund that concentrates its investments on a specific industrial or economic sector or a defined geographical area.

Advance funded pension plan
Pension plan in which funds are set aside in advance of the date of retirement.