GLOSSARY

List of Financial Terms in alphabetical order:

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Tax Exempt Special Savings Account (TESSA) Tax-free individual savings account that has been used in the past as an investment vehicle in the U.K. This type of account has now been replaced by the Individual Savings Account (ISA).

Tax-Sheltered Annuity (TSA) A tax sheltered retirement investment instrument in the United States for employees of certain non-profit organizations and educational organizations. Contributions are made on the basis of a percentage of their income on a pretax basis and the annuity earns tax-deferred income until retirement. There are restrictions on withdrawals and contribution levels set forth in the U.S. Internal Revenue Code.

Technical Analysis The study and research of the demand and supply dynamics of financial markets. This contrasts with fundamental analysis, which is concerned with the financial analysis of an individual company.

Tender Offer The sale of securities where the seller sets a tender price to offer the securities for sale. Tenders are made where applicants state the price they are prepared to pay for the securities. The securities then are sold to the highest bidder.

Term Life Insurance Life insurance that provides death benefit coverage during a limited number of years and expires without value if the insured survives the stated period.

Term Loan A loan type that specifies the time frame or period in which the principal is to be repaid. Usually the borrower pays the loan back in periodic installments plus interest. A private placement is a form of a term loan.

Term Loan See Term Loan.

Term structure of Interest Rates Relationship between interest rates on debt of different maturities.

TESSA See Tax Exempt Special Savings Account

Third Country Trading International trade that is conducted among three countries (a.k.a., triangular trading).

Third Party Administrator (TPA) Insurance term that describes a third party, which is either a person or a company (not the insurer), who provides managerial and other services involved in the administration of an insurance plan for a company (the insureds).

Third Pillar Term used to describe funding for financing retirement benefits as articulated by the World Bank. Under their three-pillared system, the third pillar consists of private pension programs provided primarily by insurance companies.

Thrifts Thrift institutions are depository institutions that raise funds primarily from consumer deposits (e.g., savings and time deposits) and lend these funds primarily in the form of residential mortgage and consumer loans. Thrifts include savings and loan associations (S&Ls) and savings banks.

Tier I Capital A component in computing the capital adequacy of banks. It refers to the core capital, which consists of the sum of equity capital and disclosed reserves. Tier I or core capital is used to cover both credit and market risk in a bank's trading and lending books

Tier II Capital A secondary component in computing capital adequacy. It includes undisclosed reserves, general provisions/general loan loss reserves, asset revaluation reserves, hybrid debt-equity instruments and subordinated long-term debt. Tier II or supplementary capital is used to cover both market and credit risk in a bank's trading and lending books.

Tier III Capital An additional component to be faceted into the newly merged market risk and credit risk based capital adequacy framework. It refers to an additional type of capital, composed of short-term subordinated debt issues that meet specific criteria. Tier III or market risk capital can only be used to cover market risk in the calculation of capital adequacy.

Time Deposits A certificate of deposit or savings account at a bank or other financial institution where funds are not available on demand. Because the funds are promised to the bank for a predetermined amount of time, the bank can invest the funds in longer term, higher yielding investments.

Title Insurance An insurance policy that protects the title of a parcel or property. Essentially it insures that the ownership is as the policy states as well as the priority of any liens on the property is as the policy states. This can protect either the current or future property owner or a lender providing funds to purchase a property.

Total Capital Term used to describe Tier I, Tier II and Tier III capital when calculating overall capital adequacy for a bank.

TPA See Third Party Administrator.

Tranche Part of a single financing or security that is split into different maturities or principal amounts (or sometimes different currencies).

Transaction Account An account over which transactions related to payments and receipts are processed. Also referred to as an operating account.

Transaction Services A term that describes the various fee income generating services that a bank performs for its customers (e.g., money transfers and cash management services).

Transparency Refers to the degree of full disclosure of accounting and other relevant data in financial reporting.

Travelers Checks Checks issued by financial institutions that enable the holder to pay for goods and services or convert them into cash. Customers pay a fee and then sign each check. The check is an accepted form of payment worldwide once the holder has countersigned with the same signature.

Treasuries A category of negotiable debt securities sold by the U.S. government and backed by the full faith and credit of the government. These include treasury bills, which are short-term securities (less than one year), treasury bonds that are long-term instruments (maturities up to 10 years) and treasury notes (medium-term securities with maturities between 1 and 10 years).

Treasury Bills US Treasury debt instruments issued by the US Federal government with original maturities of one year or less.

Treasury Bonds US Treasury debt instruments issued by the US Federal government with original maturities of five years or more.

Treasury Bond Yields The return on investment available to investors in Treasury bonds. The yield is equal to the interest paid on the bond divided by the current market value of the bond.
Treaty A contract of reinsurance.

Trust See Trusts.

Trust Company A financial institution (often combined with a commercial bank) that acts as an agent or trustee. These institutions administer funds and perform fiduciary investment management services for individuals or businesses.

Trust receipt Agreement signed by the Importer stating that the importer is the bank's agent and is acting for the bank in selling the goods. Part of the agreement is that any outstanding loan or acceptance will be liquidated (repaid) when the sale of the goods is completed.

Trustees Trustees administer trusts, which includes making investment decisions, paying taxes, filing legal reports and providing income to beneficiaries all according to the terms of the trust agreement. See also Trusts.

Trusts Trusts are legal entities that earn income, pay taxes and distribute income, just like a corporation. Trusts are created when the owner of assets (called the grantor) transfers ownership of the assets to a trustee. The trustee can be an individual or an organization (e.g., a financial institution), and the trustee administers the trust, which includes making investment decisions, paying taxes, filing legal reports and providing income to beneficiaries all according to the terms of the trust agreement.

Tax-Sheltered Annuity (TSA) See Tax-Sheltered Annuity.

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