Banking Glossary (B)

Balance Transfer
	Transferring balances from one credit card to another, usually to take advantage of a lower interest rate. Transfers are limited to the available credit on the receiving card.
Banking Book
	The banking book comprises assests and liabilities, which are contracted basically on account of relationship or for steady income and statutory obligations and are generally held till maturity.
Bank Draft
	An instrument issued by one branch of a bank on another branch of the bank containing an order to pay a certain sum on demand to the person named on the draft. It is used to transfer funds and to settle outstanding balances between banks, or to provide a customer with funds payable at a bank in a different location. Bank drafts are valid for certain period, generally, for 6 months, as indicated over face of draft.
Banker's Cheque
	A cheque issued by a branch of a bank against consideration received. Banker's cheque are valid for a certain period as indicated on the face of the cheque. (also called Pay Order).
Bankruptcy
	A legal action, in which a person who is not able to repay his loans satisfactorily, is declared bankrupt by a court order. The collateral or security in this case becomes liable to be attached by administration to satisfy creditors.
Bankruptcy Remote
	The legal position with reference to the creation of the SPV should be such that the SPV and its assets would not be touched in case the originator of the securitization goes bankrupt and its assets are liquidated.
Base Rate
	New reference rate used by banks for loan pricing w.e.f July 2010. Base rate captures cost of deposits, cost of capitals and unallocable (common) overheads. Banks are not allowed to lend base rate except for certain specified category or borrowers.
BASEL Committee on Banking Supervision
	The BASEL Committee is a committee of bank supervisors consisting of members from each of the G10 countries. The Committee is a forum for discussion on the handling of specific supervisory problems. It coordinates the sharing of supervisory responsibilities among national authorities in respect of banks' foreign establishments with the aim of ensuring effective supervision of banks' activities worldwide.
BASEL Capital Accord
	The BASEL Capital Accord is an Agreement concluded among country representatives in 1988 to develop standardised risk-based capital requirements for banks across countries. The Accord was replaced with a new capital adequacy framework (BASEL II), published in June 2004. BASEL II is based on three mutually reinforcing pillars hat allow banks and supervisors to evaluate properly the various risks that banks face. These three pillars are :
	>	Minimum capital requirements, which seek to refine the present measurement framework
	>	supervisory review of an institution's capital adequacy and internal assessment process;
	>	market discipline through effective disclosure to encourage safe and sound banking practices
Basis Point
	A unit of measurement which is equal to 1/100th of 1%. This is used to measure changes in interest rates, stock-market indices or yield on fixed income securities. For example, if an interest rate is reduced by 50 basis points it means an effective reduction of 0.5%.
Bill Discounting
	Under this type of lending, Bank takes the bill drawn by borrower on his (borrower's) customer and pay him immediately deducting some amount as discount / commission. The Bank then presents the Bill to the borrower's customer on the due date of the Bill and collect the total amount. If the bill is delayed, the borrower or his customer pay the Bank a pre-determined interest depending upon the terms of transaction.
Bill Pay Service
	Bill Pay is a service of Online Banking from bank that allows you to pay your bills online. In addition you can elect to receive e-Bills - electronic versions of your paper bills - from your bank credit card and a variety of companies currently offering e-Bills.
Biller
	A service provider who bills his / her services at specified intervals and has facilitated receipt of payment from his customers through online banking.
Billing Cycle
	The number of days between your last statement date and your current statement date. Most service providers follow a monthly billing cycle.
Billing Statement
	A monthly bill from your credit card issuer which describes and summarizes the activity on your account including the outstanding balance, purchases, payments, credits, finance charges and other transactions for the month.
Borrower
	The person / legal entity who is taking the loan with the promise to repay it back with interest under the credit or loan agreement.
Bounced cheque
	A cheque, which a bank returns unpaid because there is not enough available balance in the account or for other reasons.
Broker
	Broker is an individual who, for a commission or a fee, brings two parties together and assists in negotiating contracts between them.
Budget
	The financial record you use to keep track of the money you earn, how much you spend and what you spend it on. Your budget also includes savings and how much you pay to your creditors.