Haircut (finance)/Definition: Difference between revisions

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A percentage that is subtracted from the par value of the assets that are being used as collateral (for example, the  commission that is charged on a [[Repurchase agreement|repo]] transaction).
(i) A percentage that is subtracted from the par value of the [[asset (finance)| assets]] that are being used as [[collateral (finance)|collateral]] (for example, the  commission that is charged on a [[Repurchase agreement|repo]] transaction). (ii) In a [[Restructuring of debt|debt restructuring]] agreement, the percentage reduction in the amount of debt that is due to be repaid to the creditors.

Revision as of 01:26, 27 October 2011

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Haircut (finance) [r]: (i) A percentage that is subtracted from the par value of the assets that are being used as collateral (for example, the commission that is charged on a repo transaction). (ii) In a debt restructuring agreement, the percentage reduction in the amount of debt that is due to be repaid to the creditors.