back-to-back loan
English edit
Etymology edit
back-to-back + loan
Pronunciation edit
Audio (US) (file)
Noun edit
back-to-back loan (plural back-to-back loans)
- A transaction where a sum borrowed for one country is secured by a deposit of the same company (internal financing) or its stakeholder (external financing) at the same or two different operating companies of the lending financial institution (which may have different legal consequences under taxation law), motivated by hedging against currency fluctuations, restrictive banking regulations in the target country, tax avoidance or money laundering etc.
- Hypernym: parallel loan
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