• Banking Terms – E




    Early Withdrawal Penalty An early withdrawal penalty is basically a penalty that is levied by a bank because of an early withdrawal of a fixed investment by any investor.
    Earnest Money An Earnest Money (sometimes called earnest payment or simply Earnest, or alternatively a Good-faith deposit) is a deposit towards the purchase of real estate made by a buyer to demonstrate that he/she is serious (earnest) about wanting to complete the purchase. When a buyer makes an offer to buy residential real estate, he/she generally signs a contract and pays a sum acceptable to the seller by way of earnest money. The amount varies enormously, depending upon local custom and the state of the local market at the time of contract negotiations.
    Earnings per Share (EPS)  The amount of annual earnings available for each share to common stockholders. This is an important parameter to analyze performance of a stock.
    E-Banking E-Banking stands for electronic banking in which banking transactions are performed through exchange of electronic signals between banks and financial institution and customers.  ATMs, Credit Cards, Debit Cards, Internet Banking and fund transfer devices like SWIFT, RTGS, NEFT etc. fall in this category.
    Economic Integration Economic integration appears when two or more nations coordinate themselves and their economies are linked up.
    Education Loan An education loan or student’s loan, is specifically meant to provide students the fund required to complete higher studies.  The period of repayment also starts after the completion period of the loan.
    Electronic Commerce (E-Commerce) E-Commerce is the paperless commerce where the exchange of business takes place by Electronic means.
    Electronic Communications Networks Electronic Communications Networks (ECNs) are alternate trading systems which provide investors with new execution choices.
    Electronic Filing Electronic filing is the method of filing of tax returns and tax forms on the Internet.
    Electronic Funds Transfer (EFT) Transferring money between accounts electronically is called Electronic funds Transfer. ATM, online payments are examples of Electronic funds transfer. These are easy, faster and efficient transactions.
    Encryption Encryption is used to ensure the privacy and protect someone’s confidential financial information.
    Endorse Signing at the back of the check before cashing, giving it to someone else or depositing.
    Endorsement Endorsement is basically the handing over of rights of a financial/legal document or a negotiable instrument to another person. The person who hands over his/her rights is known as the endorser, and the person to whom the rights have been transferred is known as the endorsee.
    Equal Credit Opportunity Act Creditworthiness is based on factors such as income, expenses, debt and credit history. ECOA ensures equal chance to each customer.
    Equifax Equifax is one of the three largest Credit reporting bureaus. It will identify theft insurance, Manage credits.
    Equity This represents the ownership capital. A common stock or an equity share is the primary source of capital for the business without which business cannot exist.
    Equity Call Warrants  Warrants issued by a company which give the holder the right to acquire new shares in that company at a specified price and for a specified period of time.
    Escrow Escrow is a legal arrangement in which an asset (often money, but sometimes other property such as art, a deed of title, website, or software source code) is delivered to a third party (called an escrow agent) to be held in trust pending a contingency or the fulfillment of a condition or conditions in a contract such as payment of a purchase price. Upon that event occurring, the escrow agent will deliver the asset to the proper recipient; otherwise the escrow agent is bound by his or her fiduciary duty to maintain the escrow account.
    Escrow Account An account in which a portion of the monthly payment is held by the lender on the borrowers behalf for the payment of future taxes, mortgage and hazard insurance, special assessments insurance, and other on-going payments as they occur. It can be considered as a trust account held in the borrower’s name to pay obligations such as property taxes and insurance premiums.
    ESCROW Account This is an account in a bank / financial institution created by an agreement between the bank, the borrower and a third party (e.g., insurance company). The customer usually deposits funds in this account towards a pre-determined use.
    Escrow Agreement Bank will give the certification to indicate the assets are deposited in the bank.
    Escrow Closing In certain regions, an escrow agent holds in escrow funds as well as documents to be signed by both the buyer and seller. Once all conditions of the closing have been satisfied, the documents and the funds are distributed by the escrow agents to the interested parties.
    Euribor Euro Inter Bank Offer Rate. It is a Daily Referenced Interest rate at which banks borrow money from other banks in European Market.
    Event-Triggered Marketing Event-triggered marketing is a tool to increase relevance, response and ultimately revenue by synchronizing the content and timing of marketing messages with customer needs and buying decisions.
    Exchange An exchange is a market place in which financial contracts are bought and sold; traditionally in a central, physical location called trading floor. More often, though, exchanges take place online between sellers and buyers of traded instruments.
    Exchange Rate The price of one country’s currency expressed in another country’s currency. An exchange rate is a basically a rate, with the help of which one country’s currency can be exchanged with the currency of another country.
    Exchange –Traded Fund Exchange-traded fund is a mutual fund that trades like a stock.
    Ex-dividend (XD)  A security which no longer carries the right to the most recently declared dividend or the period of time between the announcement of the dividend and the payment (usually two days before the record date). For transactions during the ex-dividend period, the seller will receive the dividend, not the buyer. Ex-dividend status is usually indicated in newspapers with an (x) next to the stock’s or unit trust’s name.


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