FHLB Correspondent Services: Safekeeping


	GLOSSARY

	Bankruptcy		Company has filed for bankruptcy under Federal Statute. Seeks the protection of the courts pending the reorganization or liquidation of the company.

	Broker		A person who acts as an agent for others in selling or buying securities, real estate, insurance, or other services or products.

	Calls
	Entire Calls		A company, agency, or municipality has called for redemption all of the outstanding securities of an issue of bonds or a company's preferred stock.
	Partial Calls		A company, agency, or municipality has called for redemption only a part of the outstanding securities of an issue of banks or a company's preferred stock.

	Call Date		Date upon which the securities are to be redeemed.

	Call Option		The option to buy a given amount of a commodity at a specified price during a specified period of time.

	Class Action		Legal action taken through a United States District Court by a group (class) of investors against a defendant, which could be the management of a company, an agent, brokerage firm or investment banker.

	Clearinghouse Funds (CHF)		Funds which are available for use (good funds) one business day after payable date.

	Conversion		One type of a company's securities are exchanged for another type of the company securities, e.g. preferred stock converted to common stock, convertible debentures converted to preferred stock or common stock.

	CUSIP Number		A standard security identification number that is universally recognized in the securities industry. For every security, there is a unique, nine-digit CUSIP.

	Custodian		Banks that are responsible for: Processing all security transactions Safekeeping all portfolios

	Default		Failure on the part of an obligor to meet a financial obligation in the payment of principal or interest.

	DF		Delivery of an asset vs. no money (free).

	DTC		Depository Trust Company

	DVP		Delivery of an asset vs. payment

	Exchange		An issue of a company is being exchanged for another type of security, usually the result of a merger. Stock/Bonds of the old company are exchanged for Stock/Bonds of the new company or cash.

	Expiration Date		The final day that one can exercise a right (such as a voluntary tender offer).

	Fails		A trade that "fails" to settle.
	Buy		The buyer does not receive the security on the pre-specified settlement date.
	Sell		The seller does not deliver on the pre-specified settlement date.

	Fed Funds (FF)		Funds which are available for use (good funds) on payable date.

	Liquidation		A company reports its intention to liquidate its business and commences an action or series of actions which eventually results in the company's dissolution.

	Merger		Absorption by a corporation of one or more others. Also, any of various methods of combining two or more entities. Shareholders may have one, or several options to choose from in the exchange of shares of the old company, or there may be no option.

	Money Market		The common term for the mechanism whereby loanable funds are traded in the form of short-term debt securities.

	Mortgage-Backed Security		A bond-type investment security representing an undivided interest in a pool of mortgages.

	Nominee Name		In order to facilitate the transfer of registered physical securities, investors and safekeeping facilities create nominee partnerships with the Securities and Exchange Commission by registering a security in the name of the nominee. The amount of paperwork required to transfer the owner of record is greatly reduced.

	Open Trade		Refers to a trade that has not yet settled. The time period between the trade date and settlement date.

	Payable Date		Date on which principal or income on securities, or new securities, are due from paying agents. (Provided that the issuer is not in default.)

	Portfolio		The security holdings of a financial institution.

	RF		Receipt of an asset vs. no money (free).

	RVP		Receipt of an asset vs. payment.

	Switch		An internal transfer of an asset between two safekeeping accounts.