Money services business (MSB)

A money services business (MSB) is an organisation that transfers money or converts currencies. The term encompasses banks and non-bank financial institutions, including investment firms, currency exchanges and insurance organisations. The…

Moroccan Dirham

The Moroccan dirham is the official currency of Morocco. Its ISO code is MAD. The dirham is issued by the Bank Al-Maghrib, the…

Multi-currency accounts

Multi-currency accounts are bank accounts that allow their owners to hold funds, as well as send and receive payments, in different currencies. In practice, they mimic a structure featuring multiple…

Multi-currency notional pooling

Multi-currency notional pooling is a variation of notional pooling consisting of a banking arrangement carried out by multinational companies to offset their balances in different currencies in order to optimise…

Multi-currency pricing

Multi-currency pricing is the method by which international companies set and update their pricing strategy in local currencies in all the markets where they sell their goods or services.

Multi-currency system

The concept of a multi-currency system in the corporate environment refers to software solutions that enable international businesses to buy and sell currencies in order to finance their international operations.

Multilateral Netting System

A Multilateral Netting System is a method of managing corporate treasury that involves offsetting payables against receivables between group subsidiaries, reducing cash in transit and providing diverse advantages for treasury…

Natural currency hedging

Natural currency hedging is a method of protecting a company against currency risk consisting in holding two assets whose value changes offset each other. The negative change in the value of one…

Net Investment Hedge

The IFRIC 16 interpretation of the IFRS standards defines a net investment hedge of a foreign operation sd the derivative product aimed to minimise the impact of foreign exchange fluctuations…

Netting

In general terms, netting refers to the practice of consolidating two different settlements in order to create a single value. More info Currency Accounts

Non-Convertible Currency

A non-convertible currency, also known as a “blocked currency”, is the legal tender of a country that is not traded at all on the international foreign exchange market, usually…

Nonmonetary assets and liabilities

Nonmonetary assets and liabilities is a financial accounting term that refers to all the company’s assets and liabilities whose value cannot be not easily converted into cash or cash equivalents. Examples…

Notional amount

In foreign exchange, the notional amount, also known as the notional principal, or the notional value, is the amount of currency to be sold and bought. It is important to…

Open forward contract

An open forward contract is an agreement between two parties to exchange currencies at a predefined exchange rate on a future date. This can be done in one go –…

Optimal hedge ratio

The optimal hedge ratio or minimum variance hedge ratio is a concept that defines the degree of correlation between an asset or liability and the financial product (normally a futures…