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Glossary of Terms

In addition to the definitions which appear in the Standards MT General Information, Glossary of Terms, the following terms apply to Category 5 messages:

Accrued Interest: An amount of money representing the revenue from a security for a portion of an interest period.

Advice of Execution: A report sent by the executing party to give brief and early information about a securities deal.

Advice of Income in the Form of Securities: An advice of an event related to income in the form of additional securities derived from securities held in custody or being traded in.

Advice of Money Income: An advice of an event related to cash income derived from securities held in custody, or being dealt in.

Advice of Receipt/Delivery of Securities: An advice which gives early information without all details, of a receipt or delivery of securities. It covers receipts and deliveries, both free and against payment. It will normally be followed by the formal and complete confirmation.

Advice of Redemption: An advice normally sent by a custodian to its customer to give a notice of a forthcoming redemption, or maturity, or advice of the money amount and details of the completed redemption.

Advice of Securities Proceeds: An advice sent by a financial intermediary acting as a collection agent and in response to a presentation of coupons, bonds or other securities due for payment.

Agent: Facility administrator(s).

Agent Bank: A bank which controls the payment mechanism of a trade. For many trades, the Agent Bank is also the Custodian Bank.

AIBD The Association of International Bond Dealers: Organisation representing Eurobond players. In addition to its representative function, it has declared its intention to apply for the status of the 'Recognised Investment Exchange' for Eurobonds in London.

Arbitrage: Buying securities in one country and selling them in another with the object of making a profit.

Bearer Stocks/Shares: Securities for which no register of ownership is kept by the company concerned.

Book Value: Book value is the price per security needed to be recorded for tax purposes in some countries.

Broker: An individual/firm licensed to trade on a particular market on behalf of investing clients.

Clearstream: Organisation fulfilling clearing, settlement and depository functions for the Eurobond market.

Certificate: The document issued by a company to a member of that company specifying the shares of stock held by them.

Certificate Number: A number identifying one specific document of any security issue, including transferable or negotiable receipts representing underlying securities.

Clearing: Following a trade, the transfer of the traded security from original owner to new owner, either physically or by book-entry.

Components of Income/Redemption: Special information about the income and/or redemption amount. For instance, a specification can be given for tax purposes of what portion of the income derives from capital gains. It may also specify a payment from multiple coupons.

Confirmation of Delivery Against Payment: A confirmation with an option to include itemised accounting details, of the delivery of specified securities, physically or by book-entry, to a specified party against a specified amount of money.

Confirmation of Delivery Free: A confirmation with all details of the delivery of specified securities, physically or by book-entry, to a specified party free of payment.

Confirmation of Purchase or Sale: A confirmation sent by the executing party providing for the accounting in detail for the securities as well as the payment side of the deal.

Confirmation of Receipt Against Payment: A confirmation, with an option to include itemised accounting details, of the receipt of specified securities, physically or by book-entry, from a specified party against a specified amount of money.

Confirmation of Receipt Free: A confirmation with all details of the receipt of specified securities, physically or by book-entry, from a specified party free of payment.

Coupon: On Bearer Securities, a detachable part of the certificate exchangeable for dividends. Also used to denote the rate of interest on a Fixed Interest security.

Coupon Clipping Date: The date established by the custodian of the securities, on which the coupons are to be clipped.

Coupon Due Date: The due date of the next coupon attached to the security.

Coupon Number: The number of the next coupon due.

Custodian: A financial institution, usually a bank or trust company, which manages the relationship of a market participant with its Agent Banks around the world.

Deal Amount: The deal price multiplied by the quantity of securities purchased/sold.

Deal Price: The currency code and the price or percentage rate at which the deal was made. Also see 'Deal Amount'.

Dealer: A firm trading for its own account.

Deliver Securities Against Payment: An instruction to deliver specified securities, physically or by book-entry, to a specified party and to receive a specified amount of money.

Deliver Securities Free: An instruction to deliver specified securities, physically or by book-entry, to a specified party without receiving payment.

Delivery Date: The date on which securities are to be/have been delivered/received.

Denomination: The face value expressed in terms of either nominal amount or number of shares/units represented by the security document.

Distribution Ratio: The number of rights required to subscribe to a specified number of securities.

Dividend: Payment from a company's profits to its shareholders.

Dividend/Interest Rate: The amount of income per share/unit expressed in terms of the currency code, the amount, and when necessary, the period for which the income was paid/received.

Drawdown: The difference between the price which a member of a selling group pays to the syndicate manager for a new issue and the price to the public. Also called Selling Group Commission or Reallowance.

Error Rate on Clearing and Settlement: The percentage of international trades where, due to error and delays, delivery and settlement do not occur on the date specified in the trade.

Eurobonds: Bonds, denominated in major currencies (primarily USD), for which the market is entirely international, that is, trading is not confined to domestic markets.

Euroclear: Organisation fulfilling clearing, settlement and depository functions for the Eurobond market.

Euroequities: Equities whose initial offering is made simultaneously in more than one country.

Execution Date: The date on which the Sender wishes to exercise the option.

Exercise Date and Striking Price: The last day on which the option can be exercised as well as the currency code and price at which the security can be purchased or sold on or before that date.

Expiry Date: The date on which an offer/order ceases to be valid.

Final Value: The value of the holdings specified.

Global Custodian: A financial institution, usually a bank or trust company, which manages the relationship of a market participant with its agent banks around the world.

ICCH International Commodities Clearing House: Organisation owned by major UK banks supplying trade matching and clearing services to several futures and options exchanges around the world.

International Equities: Equities where trading often involves at least one foreign counterparty, that is, where at least one counterparty is located in a country other than where the equity is listed and held.

International Securities Identification Number (ISIN): A standard number for the identification of securities as specified in ISO 6166.

ISCC International Securities Clearing Corporation: A subsidiary of the National Securities Clearing Corporation (NSCC), representing US brokers and banks, charges with establishing clearing and settlement links with similar organisations in other countries.

LIFFE: London International Financial Futures Exchange.

Limit: A restriction set on an order to buy or sell, specifying a minimum selling or maximum buying price.

Market Value: The price at which quoted shares can be bought and sold on the stock exchange.

NASD National Association of Securities Dealers: Organisation representing US brokers and dealers.

NASDAQ National Association of Securities Dealers and Quotes: US organisation owned by NASD (National Association of Securities Dealers), which operates a nationwide over-the-counter trading system for equities.

Net Proceeds: Net proceeds is the total amount of money charged or paid to an account for a securities transaction.

Notice of Bond Holders or Share Holders Meeting: A notice sent by a custodian or other interested party, such as transfer agent, which requests the Receiver to inform its bond or shareholding customers about the share holders or bond holders meeting of a company.

Notice of Event: A notice sent to give particulars of an event effecting a security.

Notice of Offer or Privilege: A notice sent by a custodian to its customer which describes an offer by a third party in respect of a specified security in return for cash, other securities, or both.

Notice of Rights: A notice sent by a custodian to its customer to provide details of rights to a current or future debt or equity subscription.

NSCC National Securities Clearing Corporation: Cooperative organisation owned by the New York Stock Exchange, American Stock Exchange, National Association of Securities Dealers, and US banks and brokers, performing the clearing and settlement functions for 90% of US domestic securities trades.

Option: An agreement giving the rights to buy and sell a share at a pre-arranged price at a future date.

Order to Buy: An instruction sent by a client, or his authorised representative, to buy a given quantity of an identified security under specified conditions.

Order to Sell: An instruction sent by a client, or his authorised representative, to sell a given quantity of an identified security under specified conditions.

Over the Counter Trading: Trading of securities outside a recognised exchange.

Paying Agent's Claim: A claim by a paying agent for reimbursement of income, or redemption proceeds, or a combination of both.

Price Limit: A price given by the Ordering Party, lower or higher than which securities are not to be sold or bought respectively.

Price per Unit: The price of one unit of the security.

Primary Market: The markets for new issues of securities - stock options and bond flotations.

Proxy: An authorisation to vote.

Proxy Deadline: The last date on which a proxy or authorisation and instructions to vote, relative to a bond or shareholder meeting will be accepted.

Proxy or Authorisation and Instructions to Vote: A proxy or authorisation and instructions to vote sent to a custodian by a party authorised to give voting instructions concerning securities held by the custodian.

Quantity of Securities: The classification of securities and their quantity.

Quantity of Securities Booked: The classification and quantity of securities posted to a safekeeping account.

Quantity of Securities Derived: The classification and quantity of securities derived from the quantity of securities held and the distribution ratio.

Receive Securities Against Payment: An instruction to receive specified securities, physically or by book-entry, from a specified party, and to pay a specified amount of money.

Receive Securities Free: An instruction to receive specified securities, physically or by book-entry, from a specified party without paying an amount of money.

Redemption Amount: The redemption price multiplied by the quantity of securities expressed in terms of the currency code and the amount.

Redemption Price: The price or percentage price of the redemption expressed in terms of the currency code and the price.

Registered Name and Place of the Company: The official name and address of the company referred to in the message.

Safekeeping Account: The account for which securities are to be withdrawn or to which securities are to be deposited.

Secondary Markets: The markets for trading securities.

Series Designation: The differentiation of portions to the same issue.

Settlement: The procedure by which securities are exchanged free of counter value or against payment.

Settlement Date: The date on which securities or funds are to be exchanged.

Special Concessions: A discount from the issue price such as a drawdown. It can be expressed either as an amount of money or as a percentage rate.

Statement of Holdings: A statement sent by a custodian which lists, as of a specified date, the quantity and identification of the securities and optionally other holdings. held by the Sender for the Receiver or the Receiver's customer. The statement may also include securities held by the custodian with sub-custodians.

Statement of Numbers: A statement which gives certificate numbers of securities.

Statement of Open Orders: A statement, sent by a party which has accepted one or several orders to buy and/or sell securities, which identifies those orders, as of a specified date, which have not yet been legally agreed.

Statement of Pending Transactions: A statement sent by a custodian identifying all transactions, as of a specified date, in a specified account, for which instructions have been received but, have not yet been effected. The statement may also include future settlements or forward transactions which have become binding on the Receiver.

Statement of Transactions: A statement which lists the details of all the increases and decreases of holdings which occurred during a specified period in a safekeeping account or in a particular security in the account of the Receiver, or the Receiver's customer.

Striking Price: The price at which an option can be exercised at or before expiry.

Subscription Price: The currency code and the money amount to be paid to acquire the smallest full unit in the new issue.

Trade Confirmation: A message confirming the details of a trade, which the counterparties in the trade send to each other, after the trade, for matching purposes.

Trade Date and Place: The day, and optionally, the place, for example, stock exchange or other market, where the deal was agreed/executed.

Trade Matching (centralised): A central facility matching all trades in a particular market by comparing the trade confirmations sent to it by the two counterparties of each trade, in order to ensure that the counterparties agree on the details of the trade.

Trade Matching (decentralised): Each counterparty of a trade comparing the trade confirmation sent to it by the other counterparty to its own record of the trade, in order to ensure that they both agree on the details of the trade.

Underwriter: An institution which undertakes to the Mandate Holder that funds or other financial arrangements will be provided.

Underwriting: A commitment to provide funds or other financial arrangements.

Warrant: A special kind of option, given by a company to holders of a particular security, giving them the right to subscribe for future issues, either of the same or some other security.