Unformatted text preview: . >> Loan Participations 0522 In certain industries, a typical customers borrowing needs often exceed its banks legal lending limits. To accommodate the customer, the bank may participate the loan to other banks (that is, transfer under a participation agreement a portion of the customers loan to one or more participating banks). >> Bankers Acceptances 0524 Bankers acceptances provide a way for a bank to finance a customers purchase of goods from a vendor for periods usually not exceeding six months. Under an agreement between the bank, the customer, and the vendor, the bank agrees to pay the customers liability to the vendor upon presentation of specified documents that provide evidence of delivery and acceptance of the purchased goods. The principal document is a draft or bill of exchange drawn by the customer that the bank stamps to signi...
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This note was uploaded on 01/20/2013 for the course ACCOUNTING 301 taught by Professor Gramlich during the Fall '11 term at University of Southern Maine.
- Fall '11