Glossary
A
Advisory Services
Product description denoting a range of advisory services DVB provides to Shipping Finance, Aviation Finance and Land Transport Finance clients, covering consultancy related to corporate acquisitions and divestments, strategic decision-making on finance and capital structure, loan restructuring, and the funding of acquisitions
Asset
Specifically, a transport asset to be financed
Asset & Market Research
Product description for in-depth analyses of transport assets and markets – DVB's Asset & Market Research provides the fundamental basis for the business activities of the Bank's business divisions.
B
Basel II
In 2004, the Basel Committee on Banking Supervision issued the Basel II Framework containing international standards for risk-adjusted capital adequacy of banks and financial services providers. Basel II has replaced the capital adequacy rules of its predecessor, Basel I.
Business volume
Financial indicator measuring a company's business performance. The business volume of a bank comprises its total assets plus irrevocable loan commitments.
C
Cash flows
Cash and cash equivalents paid and received during a given accounting period
Commercial Paper
Listed bearer debt securities, used to cover the issuer's short-term funding requirements
Cost/income ratio (CIR)
Financial indicator used for the purposes of the cost efficiency management of a company; the cost/income ratio expresses the ratio of operating expenses to operating income.
Customer lending volume (nominal)
Indicator comprising the aggregate of loans and advances to customers, guarantees and indemnities, irrevocable loan commitments and derivatives; it is determined through consolidation in line with applicable regulatory provisions.
G
German Corporate Governance Code
The German Corporate Governance Code (the "Code") provides rules designed to safeguard the efficiency and transparency of corporate governance and control, and to ensure that they are geared towards the long-term growth of enterprise value. The Government commission "German Corporate Governance Code" reviews the Code at least once a year, against the background of ongoing national and international developments, and amends the wording if necessary.
I
International Financial Reporting Standards (IFRS)/International Accounting Standards (IAS)
International accounting standards published by the International Accounting Standards Board (IASB). The purpose of IFRS is to provide investors with relevant information about an enterprise – on the net assets, financial position, and results of operations – to make investment decisions. Moreover, IFRS enhance transparency and improve the comparability of financial statements on an international level.
L
Loan Participations
Denotes the business activities of DVB's subsidiary ITF International Transport Finance Suisse AG, which is actively participating in international senior asset-based lending
Loan-to-value ratio (LtV)
Ratio of the loan amount to the market value of the financed asset, expressed as a percentage. The lower the LtV ratio, the lower the potential risk exposure for the lender in the event of the borrower's default (in which case the lender would need to realise collateral).
London Interbank Offered Rate (LIBOR)
Reference interest rate, used to price transactions amongst banks on the international money and capital markets
M
Medium-term notes (MTN)
Listed medium-term debt securities
Mezzanine facility
Quasi-equity items which are classified – from an economic perspective – as a hybrid of equity and liabilities (such as subordinated capital, or profit-participation certificates)
P
Private Equity Sourcing and Investments
Funds initiated and managed by DVB's Investment Management division provide the Bank's clients with equity products to finance investment projects.
Profit-participation certificate
Certificated, listed profit-sharing right; depending upon their terms and conditions, profit-participation certificates may be eligible for inclusion in the Bank's liable capital.
R
Return on equity (ROE)
Expressed as the rate of return achieved on the capital invested by the shareholder over a given accounting period, the return on equity is calculated as the ratio of the consolidated net income before taxes to the weighted amount of capital.
Risk Distribution
Partial syndication of large-sized loans on the international interbank market, for the purposes of transferring risks and raising liquidity
S
Societas Europaea (SE)
Legal form of a European public limited-liability company
Structured Asset Financing
Product description, comprising traditional asset finance, as well as tailor-made structured and tax-optimised solutions for complex financing projects in the Shipping Finance, Aviation Finance and Land Transport Finance business divisions
Subordinated capital
Unsecured subordinated liabilities bearing a fixed rate of interest; in the event of bankruptcy proceedings or liquidation, they may not be redeemed until all unsubordinated creditors have been satisfied.