UBS Dictionary of Banking

La

Land Register / Grundbuch / registre foncier / registro fondiario
Public register in which all rights to real estate properties are entered. Under Swiss law, the Land Register consists of the main ledger (one page for each property), supporting documents and a chronological register for entries, building lot plans and property descriptions. The Land Register is kept by the Land Register Office under the supervision of the cantons.

Land Register extract / Grundbuchauszug / extrait du registre foncier / estratto del registro fondiario
Description of all entries (rights, charges, notations, provisional reservations, encumbrances, etc) in the Land Register referring to a particular property.

large cap / Standardwert / valeur de fond de portefeuille / titolo a largo mercato
Also known as blue chip. Share of widely known companies with large stock market capitalizations and which are heavily traded on the stock markets.

large-denomination share / schweres Papier / titre lourd / titolo pesante
Share with a high par value or a price well above the average.

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Lb

LBO
Abbr. for leveraged buyout.

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Le

lead bank
Synonym for lead manager.

lead manager / Lead-Manager / chef de file / lead manager
Also: lead bank. Bank acting as the leader of an issuing or lending syndicate, managing the transaction. It is normally responsible for contact with the borrower, for the structure, organization and text of the loan agreement and prospectus, plus the composition of the issuing syndicate and the selling group and, ultimately, for the placement itself.

leading indicator / Frühindikator / indicateur avancé / indicatore anticipatore
Economic indicator which changes before the overall economy itself changes, and is therefore seen as an indicator of future developments.

leasing / Leasing / crédit-bail / leasing
The renting out, for a specific period, of industrial equipment, facilities and capital goods (machines, technical installations, vehicles, etc). The manufacturer or - in the case of leasing in the narrower sense of the word (financial leasing) - special leasing companies act as principals. Leasing helps to preserve liquidity. 100% borrowing on a pay-as-you-earn basis. Fixed monthly costs cover interest, amortization, the upfront fee and (e.g. with car leasing) the insurance premium.

legal reserves / gesetzliche Reserven / réserves légales / riserve legali
The reserves which a company is required to form to comply with legal requirements (e.g. company law). Art. 5 of Switzerland's Banking Law stipulates that 5% of the annual profit is to be allocated to a reserve fund (until 20% of the paid-in capital has been reached) plus a tenth of the amount distributed from the annual profit after the regular allocation to the reserve fund and after payment of 5% to shareholders and others entitled to a share in profits. Any premiums generated during share issues must be allocated to the legal reserves, unless they are used for depreciation or employed for charitable purposes. See also voluntary reserves, reserves.

legalization / Legalisation / légalisation / legalizzazione
Also: authentication. To give legal validity to documents or signatures by having them verified by authorized officials. See also apostille.

lending business / Aktivgeschäft / opérations actives / operazioni attive
Generally covers the banking business on the assets side of the balance sheet. In a narrower sense, the loans, advances, mortgages and other types of credit granted to customers or banks. Opposite: deposit business.

lending limit / Belehnungsgrenze / limite d'avance / limite di anticipo
The maximum value of a particular object which may serve as collateral for a loan or mortgage (sometimes expressed as a percentage).

letter of credit
Synonym for documentary credit.

letter of credit issuance / Akkreditiv-Eröffnung / ouverture d'un crédit documentaire / apertura di un credito documentario
Letter by the bank of the applicant notifying the beneficiary that a letter of credit has been opened. See also documentary credit.

leverage / Hebelwirkung / effet de levier / effetto leva
Means of enhancing profitability using borrowed money by exploiting the fact that the rate of interest on equity capital is higher than the interest payable on borrowed funds. A leverage effect can also be achieved with derivatives, enabling market operators to invest in sizeable holdings of an underlying for a relatively modest capital outlay. The upshot of leveraging is that any percentage change in the gains and losses on options and futures contracts will be larger than the corresponding change in the underlying.

leveraged buyout / Leveraged Buyout / leveraged buyout / leveraged buyout
Abbr.: LBO. Takeover of a company by internal or external investors using the acquired firm's assets as security for the bulk of the loans taken out for this purpose.

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Li

liabilities / (1) Verbindlichkeiten (2) Fremdkapital, Passiven / (1) engagements (2) fonds de tiers / (1) impegni (2) fondi di terzi
(1) A company's debts appearing on the liabilities side of its balance sheet. The liquidity requirements of Swiss banking legislation draw a distinction between short-term liabilities, which include those repayable on demand or often within one month, and total liabilities, consisting of all liabilities vis-à-vis third parties (including any provisions required). Frequently used as a synonym for obligations.
(2) The obligations of a business to its creditors, suppliers, customers, etc, as distinguished from those to its proprietors, partners or shareholders. Liabilities can be short-tem, medium-term or long-term. Opposite: assets.

liability / Obligo / engagement / impegno
Widely used term for an obligation under a bill or other instrument, but can also refer to many other forms of liability, undertaking or guarantee. See also liability under bills of exchange, without our liability.

liability under bills of exchange / Wechselobligo / engagement de change / obbligazione cambiaria
Liability assumed on signing a bill of exchange.

LIBID
Abbr. for London Interbank Bid Rate.

LIBOR
Abbr. for London Interbank Offered Rate.

licence fee (GB); license fee (US) / Lizenzgebühr / redevance de licence / diritto di licenza
Payment made by licensees to the holder of a patent on a licensed invention or process. See also royalty.

lien in rem
Synonym for right of lien.

life assurance policy (GB); life insurance policy (US) Lebensversicherungspolice / police d'assurance vie / polizza di assicurazione sulla vita
Document confirming that a contract for life insurance coverage has been concluded. Serves only as evidence and is not a negotiable instrument.

LIFFE

Abbr. for London International Financial Futures Exchange.

LIMEAN
Abbr. for London Interbank Mean Rate. Arithmetical mean of bid and asked rates (LIBID and LIBOR) on the London market for interbank rates.

limit / Limite / limite / limite
(1) Highest price given for the purchase or sale of securities (price limit).
(2) Upper limit for the utilization of a credit (credit line).

limit option
Synonym for barrier option.

limited / limitiert / limité / limitato
A stipulation when placing an order to buy below or sell above a certain limit fixed by the customer. Opposite: at best.

liquid funds / greifbare Mittel / disponibilités / fondi disponibili
Assets which can be used immediately to make payments (cash liquidity). According to Article 15 of the Implementing Ordinance for the Swiss Banking Law, liquid assets consist of cash and equivalent, giro (clearing) balances and postal checking account balances.

liquid yield option note / Liquid Yield Option Note / Liquid Yield Option Note / Liquid Yield Option Note
Zero bond convertible into equities on maturity.

liquidate a position / glattstellen / dénouer / pareggiare
Also: close a position, square a position. The action of offsetting an open stock exchange or foreign exchange position with the related hedge position (for example, covering securities sold forward for a certain date by a forward purchase as of the same date).

liquidation / Liquidation / liquidation / liquidazione
(1) Dissolution of assets or of a company by realizing the assets and settling the debts.
(2) Settlement of forward or future transactions on the exchanges, with specific dates stipulated ahead of time for the individual operations (option declaration, payment, delivery of securities, etc). The liquidation calendar is determined by the stock exchange board.
(3) Closing (squaring) a forward transaction in foreign exchange or precious metals by a corresponding contra transaction with the same due date.

liquidity / Liquidität / liquidité / liquidità
The ability of an enterprise to meet its payment obligations on time. In a wider sense it means the availability of cash and cash-like funds within a company, on the money and capital markets and within the national or world economy.

liquidity statement / Liquiditätsausweis / état de liquidité / stato di liquidità
Statement showing the relationship between the disposable means and the easily marketable assets on the one hand and the short-term liabilities on the other. Regulated in Switzerland by Article 4 of the Banking Law and Articles 15-20 of the Implementing Ordinance.

list of drawings / Verlosungsliste / liste des tirages / lista delle estrazioni
Published list showing the numbers of the securities drawn for premature redemption (such as the bonds of a particular issue).

listing / Kotierung / cotation / ammissione alla quotazione
Also: admission. Admission of a security (shares, bonds, etc) for official trading on a stock exchange or exchanges.

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Lm

LME
Abbr. for London Metal Exchange.

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Lo

loan / Darlehen / prêt / prestito
A specified sum of money lent by a creditor or lender (e.g. a bank) to a person or entity and repayable at a predetermined due date or after notice of repayment is given. See also fixed advance.

loan against pledge / Faustpfandkredit / crédit contre nantissement / credito su pegno
Loan secured by the pledging of collateral.

loan against pledged bill / Wechselpension / mise en pension d'effets / pensione di effetti
A loan by the bank in exchange for a bill of exchange as pledge, blank endorsed by the customer.

loan for an unlimited period / unbefristeter Kredit / crédit de durée illimitée / credito a tempo indeterminato
Credit that is not granted for a specific period of time and where repayment can generally be demanded at any time (e.g. overdraft facility).

loan from central mortgage bond institution / Pfandbriefdarlehen / emprunt auprès d'une centrale d'émission de lettres de gage / mutuo presso una centrale di emissione di obbligazioni fondiarie
In Switzerland: long-term loan granted by a central mortgage bond institution to one of its member banks as funding for loans secured by mortgages.

loans to directors, senior executives and auditors / Organkredit / crédit aux organes / crediti a organi
Loans and advances to members of the Board of Directors, the Executive Board or the internal auditors, as well as to any companies controlled by these persons.

loan to value ratio / Belehnungssatz / taux d'avance / tasso di anticipo
Ratio of the fair market value of a collateral to the value of the loan that will finance the purchase. The more stable the value of an asset, the higher the loan to value ratio. The more unstable the asset, the lower the loan to value ratio.

local bill / Platzwechsel / effet sur place / cambiale sulla piazza
Bill of exchange accepted by a bank for collection or discounting and which is payable at the place where the accepting bank is located.

lock-up period / Lock-up-Periode / période de lock-up / lock-up period
Period in which the lead underwriter restricts insiders from selling their shares for a period of time, usually 180 days, from the effective date of the offering.

lombard loan (GB); collateral loan (USA) / Lombardkredit / crédit lombard / credito lombard
Loan granted against the pledging of securities as collateral (broker's loan) or against the pledging of goods (advance against goods as security). The costs of a lombard loan are calculated on the basis of the official or private lombard rate (rate for advances against collateral).

London Interbank Bid Rate / London Interbank Bid Rate / London Interbank Bid Rate / London Interbank Bid Rate
Abbr.: LIBID. Interest rate at which banks in London are prepared to accept each other's short-term deposits.

London Interbank Offered Rate / London Interbank Offered Rate / London Interbank Offered Rate / London Interbank Offered Rate
Abbr.: LIBOR. Interest rate at which banks in London offer to lend out short-term deposits to one another.

London International Financial Futures Exchange / London International Financial Futures Exchange / London International Financial Futures Exchange / London International Financial Futures Exchange
Abbr.: LIFFE. See Euronext.

London Metal Exchange / London Metal Exchange / London Metal Exchange / London Metal Exchange
Abbr.: LME. Exchange for non-precious metals such as aluminium, copper, nickel, tin and zinc, as well as for options and futures on these underlyings. Website: www.lme.co.uk.

long position / Long-Position / position longue / posizione long
A positive exposure to a quantity. Owning a security or commodity. Investor's position where the number of contracts bought exceeds the number sold. Opposite: short position.

losses on receivables / Debitorenverluste / pertes sur débiteurs / perdite su crediti
Losses on claims, receivables or loans, e.g. through bankruptcy, fruitless attachment or distraint or composition agreement if the dividend obtained is insufficient.

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Lt

LTV
Abbr. for loan to value.

Ly

LYON
Abbr. for liquid yield option note.

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