commercial paper

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commercial paper,

type of short-term negotiable instrument, usually an unsecured promissory note, that calls for the payment of money at a specified date. Because it is not backed by collateral, commercial paper is usually issued by major firms whose credit-rating is so good that their notes are immediately accepted for trading. The notes are sold at a discount and mature in from three to six months. Commercial paper is an important source of cash for the issuing firm; it supplements bank loans and is usually payable at a lower rate of interest than the prime discount rate. Strictly speaking, it includes only those instruments that are used in commerce in place of money, as distinguished from paper used in investment, personal, estate, speculative, and public transactions. In addition to promissory notes, commercial paper may include drafts, bills of exchange and checks, acceptances, bills of lading, warehouse receipts, orders for delivery of goods, and express orders. See. N. D. Baxter, The Commercial Paper Market (1969); Steve H. Nickles, Commercial Paper (1988).
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References in periodicals archive ?
"Upon the full payment of the CP Series A-1, the remaining balance of the commercial paper program available for the issuance is at P6.5 billion," the oil firm has qualified.
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The offer for the series 1 and 2 commercial papers, which opened on Thursday, April 11, will last for a week and close on Thursday, April 18, while the settlement date will be April 23.
Asked about this new trend of banks preparing to issue local bonds and commercial paper, BDO Capital and Investment Corp.
"Chinese onshore commercial paper market is very deep and liquid, with more than $270bilion USD outstanding amount and an average $3billion USD daily trading volume." He added.
Unveiling the names of parties involved on the commercial paper.
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commercial paper fell $10.2 billion to $964.9 billion outstanding in the week ended yesterday, the Federal Reserve said today on its website.
McJohn (law, Suffolk U., UK) presents explanations, multiple-choice questions, analyses of answers, and exam-taking tips on payments law to students taking commercial paper and payment systems courses.
16 December 2011 - S&P today gave its AA- long-term issue rating and A-1+ short-term issue rating to the USD5bn(EUR3.8bn) commercial paper notes programme by Singapore's DBS Bank.
As redemption demands accelerated, particularly in high-yielding money market mutual funds, investors became increasingly reluctant to purchase commercial paper, especially for longer dated maturities.

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