Fincancial definitions

The Repo Rate :

The repo rate refers to the rate at which the South African Reserve Bank lends money to commercial banks.

Financial GreyListing :

The process of a country being greylisted means that the Financial Action Task Force believes that the country is not fully compliant with anti-money laundering and terrorist financing. This can result in the cost of doing business in the country being greylisted increasing for foreign banks, financial instutions and investors.
The Financial Action Task Force is an intergovernmental body that sets the standards globally to combat money laundering and terrorist financing.

What Are Basis Points?

A basis point by definition is one hundredth of a percentage point (1%).

I.e. 1 basis point = 0.01%.


A 25 basis point rise in interest rates means that interest rates will increase by 0.25%.

Now if the interest rates were previously 7%, then a 25 basis points increase would mean that interest rates will increase to 7.25%.

What is Bank Failure?

Bank failure is when the bank's assets fall below the market value of the bank's liabilities.

The liabilities of a bank are the bank's obligations to creditors and depositors.

What is Credit? (A financial loan)

A contractual agreement in which a borrower receives a sum of money or something else of value from a lender and the borrower commits to repaying the lender at a later date, typically with interest.

The borrower must provide a form of collateral to the lender to receive the sum of money.