Loan Capital Market

The following article is from The Great Soviet Encyclopedia (1979). It might be outdated or ideologically biased.

Market, Loan Capital


under capitalism, a special sphere of economic relations in which supply and demand for loan capital take shape. In the loan capital market the sellers of capital are monetary capitalists (the owners of loan capital), who are represented by a vast system of credit and financial institutions, including commercial and investment banks, insurance companies, pension funds, and investment companies. The buyers are private commercial establishments, governments, or individuals (the population).

The loan capital market includes a market for short-term credit (capital)—a money market where commercial and treasury notes are bought and sold. There is also a long-term credit market, which is subdivided into a long-term capital market and a market for paper securities, where the stocks and bonds of private enterprises and bonds issued by central and local government bodies are bought and sold. In the long-term capital market, credit and financial institutions grant loans for extended periods of 20–100 years.

The loan capital market was poorly developed under pre-monopoly capitalism, owing to the limited supply and demand for the monetary capital, for which there were several reasons. Because it consisted primarily of banks, the credit system was not yet able to engage extensively in the accumulation of monetary capital and the people’s monetary savings. Other types of credit and financial institutions were just beginning to emerge. The demand for monetary capital, chiefly short-term capital, came from individual enterprises, and the state and the population very rarely turned to the loan capital market. The market for paper securities was just emerging.

Monopoly capitalism stimulated the development of the loan capital market. An enormous demand for loan capital was generated by the formation of joint-stock companies, the high concentration and centralization of production, the development of new sectors based on scientific and technological discoveries, the growing role of the state in the economy, and various other factors. State-monopoly capitalism created the preconditions for the further growth of the loan capital market. The governments of the capitalist countries actively shape economic policy, including credit policy. The state influences the loan capital market by establishing the discount rate of central banks, thus regulating the supply and demand for loan capital. As a result of the creation of state credit institutions, the state has become both a buyer and a seller on the loan capital market.

From the late 1960’s and early 1970’s credit and financial institutions commonly concluded long-term agreements, or credit lines, with commercial and industrial monopolies, stipulating the amount of a loan and the period during which a corporation could borrow from a bank or other credit and financial institution. Credit lines are especially common in the USA, which has a powerful loan capital market and a vast network of credit and financial institutions.


Usoskin, V. M. Monopolisticheskii bankovskii kapital SShA: Deistvitel’nost’imify. Moscow, 1964.
Anikin, A. V. Kreditnaia sistema sovremennogo kapitalizma. Moscow, 1964.
Bortnik, M. Iu. Denezhnoe obrashchenie i kredit v kapitalisticheskikh stranakh. Moscow, 1967.
Zhukov, E. F. Strakhovye monopolii v ekonomike SShA. Moscow, 1971.


The Great Soviet Encyclopedia, 3rd Edition (1970-1979). © 2010 The Gale Group, Inc. All rights reserved.
References in periodicals archive ?
In general terms I would agree that in M&A, ECM, loan capital market and DCM, the overall fee pools are subdued.
QIIB deputy CEO Jamal Abdulla al-Jamal, received the award from Andreas Scheer, head (Loan Capital Markets) FI Frankfurt, during a ceremony held at QIIB Headquarters on the Grand Hamad Street in Doha.
QIIB Deputy CEO Jamal Abdulla al Jamal, received the award from Andreas Scheer, Head (Loan Capital Markets) FI Frankfurt, during a ceremony held at QIIB headquarters in Doha.
Bank has 350 employees located in the greater New York City area in business lines including: Corporate Banking, Derivatives, Equipment Finance, Fixed Income, Foreign Exchange, Global Treasury Management and Loan Capital Markets.
The award is made to the most innovative investment bank operating in Africa and was given to RMB for its work on debt and loan capital markets, project and structured finance, resource finance, leveraged finance, mergers and acquisitions and IPOs.
Wessan, who has over 25 years of experience, has previously been the managing director and co-head of the Leverage Loan Capital Markets and Syndications Group at Jefferies & Company (NYSE: JEF), managing director in the Private Finance Group at CIBC World Markets (CIBC) (NYSE: CM) (TSX: CM) and has held similar positions with other firms.
Sanders complained that "late last year, it became clear that the problems in the subprime mortgage market were having a negative ripple effect on the student loan capital markets."
He has held leadership roles as Managing Director and Head of US Leveraged Loan Capital Markets at Merrill Lynch in New York as well as Managing Director and Head of EMEA Leveraged Loan Capital Markets at Bank of America Merrill Lynch (BAML) in London.
Danziger, who has 25 years of industry experience, has previously been with Deutsche Bank Securities Inc., where he was head of Investment Grade Loan Capital Markets for the Americas since 2004.
Roman joins Cowen with almost 30 years of industry experience, most recently working at RBC Capital Markets where he was Co-Head of the US Loan Capital Markets Team.
Dewing will be responsible for corporate coverage, sponsor coverage, loan capital markets, advisory and solutions, private placements, securitisation and leasing.