Banking Terms Based on the word / phrase from letter E (Part II / IV)

Banking Terms Based on the word / phrase from letter E (Part II / IV) :
Economic Capital (Risk Capital).

Is Capital, which placed as a risky asset to cover potential losses in a state of extreme market. There are two kinds of possible losses in risk management, which is 'expected loss' and 'unexpected loss'. Expected loss is usually provided cover in the form of 'provision' (can be in the form of PPAP) and unexpected loss it is also necessary to provide cover in the form of economic capital. The original idea was to estimate the capital required for a stand-alone business (stand alone) for a particular project.
Economic Capital is also known as Economic Risk Capital or Risk Capital.
Risk in this regard is the composite risk of Credit Risk, Market Risk and Operational Risk which is a manifestation of an adequate amount of capital (sufficient) to protect banks from possible losses on the portfolio of the bank until at a certain level of possible losses.
Companies (banks) use the economic capital for the purpose of:
 To hold a capital level that is safe, keep out of the disaster and meet the requirements concerning the provision of minimum capital (capital requirements)
 To hold that the risks have been managed properly and to assess whether the cost of insurance premiums and costs incurred for management control (management control) is really effective according to its purpose.
 To believe that companies (banks) do not make use of excess capital (over-capitalized)
 To hold that capital is used efficiently and give the best results (best return), evaluate and menganalysis strategies and support decision-making process. (Source: From various sources).

Effect.

Are securities, which debt instruments,
commercial berhaga mail, stocks, bonds, proof of debt, a sign of Units of collective investments, futures contracts on securities and any derivatives of securities (7).. (Source: Bank Indonesia).

Islamic Asset Backed Securities.

Securities are issued by collective investment contract Sharia porto folionya EBA consists of financial assets in the form of claims arising from commercial securities, claims arising dikenudian day, buying and selling ownership of physical assets by financial institutions, investment securities are guaranteed by the government, means increased investment / cash flow and financial assets equivalent, in accordance with Sharia Principles. (13). (Source: Fatwa DSN-MUI).

Sharia effect.

Is the effect referred to in the legislation in the capital market that contract, the management company, as well as how to meet the publication Principles of sharia. An effect is considered in compliance with Sharia Principles of the Declaration of Conformity if it has obtained the Syariah. Sharia effects include; Shares of Sharia, Islamic Bonds, Islamic Mutual Funds, Collective Investment Contract Asset Backed Securities (ABS KIK) Sharia, and other Securities in accordance with Sharia Principles. (13. (Source: Fatwa DSN MUI).

The effectiveness of hedging.

Is the extent to which changes in fair value or cash flows of the hedged item attributable to the hedged risk will be offset by changes in fair value or cash flows of hedging instruments. (11).
(Source: IAS 50 (revised 2006))

Islamic economics.

Is the business or activities undertaken by individual persons, groups and entities incorporated or not incorporated in order to meet the needs of commercial and not commercial according to Islamic principles. (13).
(Source: Compilation of Economics Sharia Law)

Exports.

Is the delivery of goods outside the customs area of ​​Indonesia.
To be able to carry out the export, the exporter must have an Identification Number Exports (APE) or Export While Identification Number (Apes). For the PMA / PMDN based Identification Number Exports Limited (APET). (9). (Source: Library No.11)

Exporters.

Is a company that does the export of goods and services produced either alone (exporters of manufacturer), or obtained from suppliers. (9).
(Source: Banking Practice)

Export Services.

Are sales of services to non-residents. (9). (Source: Bank Indonesia).

Former Controlling Shareholders.

Is a party prior to Take Over Bank Recapitalization Program:
(A) Has the amount of which shares 25% or more of the total shares issued and have voting rights on Take Over Bank Recapitalization Program Participants, except those concerned may prove not to control and / or;
(B) have shares of less than 25% of the total shares issued and have voting rights on Take Over Bank Recapitalization Program Participant, but who can prove controlling. (6). (Source: Bank Indonesia).

Electronic Funds Transfer System (EFTS).

Is a computer term for various types of electronic computerized communication system that allows to do the transfer or the transfer of financial information from a computer center location to another location without using paper documents. (12). (Source: Bank Indonesia).

Embosing.

Is a computer term to the technique used to pierce the magnetic card by filling out the bits in it. (12). (Source: Bank Indonesia).

Encoding.
Is a computer term for techniques used to convert data into code form on a magnetic card that can be read by computer equipment. (12)
(Source: Bank Indonesia)

Endosan  see → Letter Wesel.


Microfinance Institutions
Continued to Part III