They are the different parts in which the capital is divided. Thus, any person who has shares in a company can be considered as one of its owners. They grant political rights – …
Read more...Natural or legal person who has the right to demand payment of a debt. The creditor relationship normally arises as a consequence of a money loan but it can arise -...
Read more...Set of all assets and rights with monetary value that are owned by a company, institution or individual.
Read more...Official who represents the interests of society and the State before the courts of justice.
Read more...Friend of the court or friend of the court. Information provided by third parties unrelated to a dispute, who voluntarily offer their opinion on some point of law or other aspect -...
Read more...Partial or total payment of the principal of a debt. Frequently, the amount of the money received as a loan is repaid in different instances of time, for example, in monthly installments, -...
Read more...It assesses how a country's level of debt and its potential future indebtedness affect its ability, both present and future, to meet debt service.
Read more...The 12-month period from July 1 of one year to June 30 of the following year, and used as the budget calendar of – …
Read more...Finance companies that insure buyers' bonds. In the event that the entity that sells the bond cannot pay the interest and principal in the periods –…
Read more...He is a professional who provides investment advice and financial planning services to individuals and businesses. Ideally, the financial adviser helps the client maintain the desired balance between – …
Read more...Resources from the General Fund authorized by the Legislative Assembly for the development of programs or activities of a special, permanent or transitory nature. In the FY 2014-2015 budget, $76 – …
Read more...Thoroughly examine the debt issuances of the government of Puerto Rico and its public corporations in order to determine if they were made in accordance with the law and – …
Read more...The reduction of spending by governments with the objective of reducing the budget deficit, reducing public debt or as a measure to prepare in advance for – …
Read more...Public corporation created under the Puerto Rico Emergency Moratorium and Financial Rehabilitation Law, Law 21-2016. The AAFAF was created with the purpose of acting as a fiscal agent, adviser –…
Read more...Public corporation created in 1988 by virtue of Law No. 44 of June 21, 1988. AFI provides financial, administrative, consulting and technical assistance, among others, to – …
Read more...It was created through Law No. 22 of July 24, 1985. It is the other bank of the Government and should not be confused with the GDB. Your mission – …
Read more...Created in 1942 with the purpose of helping to finance economic infrastructure projects. For more than seven decades, it was the intergovernmental bank, the fiscal agent and – …
Read more...It is the value of a set of assets, investments or sources of income that is subject to tax. Tax credits and exemptions reduce the basis on which – …
Read more...An accessible bond is a bond that can be redeemed by the issuer prior to maturity. If interest rates have been reduced since the company issued – …
Read more...A parity bond refers to two or more bonds issued with equal payment rights or the same age as each other. In other words, a parity bonus is – …
Read more...Debt security in which the authorized issuer promises to pay a return, in addition to the amortization of the principal, which varies with the behavior of the Gross National Product (GNP) of -...
Read more...It is a debt security, representing a commitment made by the issuer in order to guarantee the return of the initial capital with its corresponding interest in a stipulated period of time. – …
Read more...Also known as junk bonds. These are bonds with low credit rating (see ‚credit rating‚) and high investment risk. They offer high performance to compensate for the high – …
Read more...They are bonds that give the holder the right to sell the bond to the issuer before its maturity date.
Read more...Long-term bonds, whose payment of interest and principal is deferred for years or until the bond's maturity date. Since interest is not paid, it is – …
Read more...A bond in which interest payments are made to bondholders on a periodic basis. This term is most often used in the context of – …
Read more...It is a form of debt issued by municipal governments. If a governmental body has taxing power, regardless of whether it is a city, state or American territory; then it can be – …
Read more...Bonds issued by the Government retirement system or other retirement instrumentalities to provide liquidity or to capitalize their pension funds. Contrary to various jurisdictions of States – …
Read more...Bonds that have priority of claim against the higher promised income against the claim of said promised income or the security of other obligations.
Read more...It is the article of the bankruptcy code of the federal bankruptcy law (Title 11) that enables the municipalities of the states in the United States to restructure their debt. – …
Read more...They are companies that are in charge of evaluating the financial situation, in this case of the government, to determine the risk that an investor incurs when lending his money. The most famous - …
Read more...Credit risk indicator with a financial instrument or a financial institution. It is a rating given to a particular entity on the basis of credentials, financial statements –…
Read more...It is a contractual provision that allows a lender to require a borrower to repay an outstanding loan in full if certain requirements are not met. An acceleration clause describes – …
Read more...When the lack of endorsement of a guarantee in any note does not affect or impair its validity.
Read more...Executive Order 2015-046 issued by Governor Alejandro García Padilla on December 1, 2015 and which, protected under the Constitution, authorizes the Department of the Treasury to withhold income from – …
Read more...The Audit (of the debt) was left in the hands of the Public Credit Comprehensive Audit Commission, created by Law No. 97 of July 1, 2015. This Commission – …
Read more...Corporation organized outside the United States and controlled by United States shareholders. Those companies that operate in Puerto Rico are considered CFCs. In general, a CFC can defer the – …
Read more...Potential conflict between the official functions and responsibilities of a person or entity and their individual, family or institutional financial or economic interests. In this situation you can give the – …
Read more...Society that is constituted between producers, sellers or consumers, for the common utility of the partners.
Read more...The Compelling Interest Fund Corporation (COFINA) was created by virtue of Law 91 of May 13, 2006, as amended, in order to finance the –…
Read more...Public corporation created by Law No. 19 of 2014. COFIM is empowered to issue bonds and use other financing mechanisms to pay or refinance, directly or indirectly, all – …
Read more...Public instrumentality that offers services such as electricity; drinking water; telecommunications; education; art and culture; natural resources; agriculture; land administration or land conservation; solid waste management or – …
Read more...Actions of fraud, abuse, waste or non-compliance by officials that result in the misuse of Government resources and that undermine the trust of citizens – …
Read more...The Earned Income Tax Credit (EITC) is a government benefit for low- to moderate-income workers. To qualify you must meet certain requirements – …
Read more...Colloquial way of referring to Law 1 of 2015, which increases the tax on a barrel of oil from $9.25 to $15.50.
Read more...It is commonly used to refer to a debt default. However, in addition to non-payment, the default can be any type of non-compliance with the repayment terms of the debt. – …
Read more...When expenses exceed revenues in the fiscal year budget. In fiscal year 2012 the budget deficit was $1,449 million. It is estimated that the budget deficit – …
Read more...There are several definitions of this term but, in the context of debt, it mostly refers to insufficient income to cover the expenses that are proposed in the – …
Read more...A reduction in the credit score range, for example from A to BBB. The accrediting houses that classify the credit of Puerto Rico are Standard and Poor's, Moody's and – …
Read more...Deep economic contraction that persists for an extended period of time. It manifests itself in a weak demand, a contraction of international trade, a growth in unemployment and a fall –…
Read more...Improper, fraudulent appropriation of goods or values that have been taken into custody or administration. If it is carried out by an official and it deals with wealth and public effects, it constitutes a crime -...
Read more...Obligation that someone has to pay, satisfy or reimburse another person for something, usually money.
Read more...It refers to the debt of general obligations. The constitutional debt is made up of bonds and promissory notes of the central government of Puerto Rico for whose repayment it has pledged -...
Read more...That debt incurred by the Government for whose payment the power to impose taxes of the State is not committed is what is commonly classified as extra-constitutional debt. To calculate - …
Read more...The term has been used in relation to the claims of a group of citizens for the debt to be audited under the argument that part of that debt – …
Read more...Debt contracted by the government of Puerto Rico with natural or legal persons of the public sector. The internal debt is mostly made up of loans from municipalities, public corporations and the – …
Read more...The debt of a municipality. Municipal debts are part of public debt. In 2014, the total municipal debt was $3,000 billion.
Read more...The term is used in two ways. First, as the total debt contracted by all public entities: the central government, public corporations and municipalities and – …
Read more...Debt contracted with another state or international organization or with any natural or legal person outside the country.
Read more...Obligations contracted by the national state through the placement of titles in the country and the money obtained by the State on loan arises from the national economy itself. – …
Read more...Debt issued by COFINA that has priority at the time of payment. This debt was issued between 2007 and 2009. After the payment agreement was negotiated – …
Read more...Debt whose payment priority is below the senior debt. After the debt payment agreement was negotiated these bonds in 2019 under the Title – …
Read more...Reduction in the value of the bonds. The bonds issued by the BFG were trading at 36 cents on the dollar in April 2016, which –…
Read more...Fee that, when distributing profits by a mercantile company, corresponds to each share.
Read more...Initials of Debt Sustainability Analysis, or, as it is known in Spanish, debt sustainability analysis.
Read more...Sale of bonds in the financial market. The issuance of general obligation bonds of the government of Puerto Rico must be authorized by the Legislative Assembly. According to the Article – …
Read more...Form of financing of companies at the private level and of countries at the public level. The main objective is to place the debt among investors offering a return of – …
Read more...Entity that originates and puts into circulation securities or financial instruments (which can be traded on the stock markets).
Read more...Proposal outlined by the cooperatives that establishes that the starting point of a renegotiation with the creditors who bought Puerto Rico bonds at discounts should be the price –…
Read more...Reports on the financial situation of a company or public body. They generally occur annually. The most recent financial statement of the government of Puerto Rico is the – …
Read more...When the financial statement is examined and certified by an auditing and accounting entity external to the audited entity. The auditor of the financial statements of the government of Puerto – …
Read more...Under the current laws of the United States Congress (Jones Act of 1917), the interest of most of the bonds issued by the Commonwealth of Puerto Rico, -...
Read more...Disposition by which the testator leaves his estate or part of it entrusted to the good faith of someone so that, in a specific case and time, he transmits it to -...
Read more...Created in 1999 to manage the funds associated with Puerto Rico as a result of the transaction agreement signed by the tobacco companies. Manages programs aimed at improving quality – …
Read more...Person or entity that manages the assets of a trust. It is also commonly used to refer to the custodian of some property or patrimony. For example, the trustee of – …
Read more...It is a financial corporation whose divisions include Fitch Solutions, Fitch learning and BMI Research. The international credit rating agency has dual headquarters in New York and London.
Read more...It was created under Law No. 7 of March 9, 2009, also called “Special Law Declaring a State of Fiscal Emergency and Establishing Comprehensive Fiscal Stabilization Plan for – …
Read more...The main government piggy bank, where the taxes paid by taxpayers go and where the money comes from to pay the expenses of central government agencies – …
Read more...Buyers of bonds from a government or company on the brink of bankruptcy, at a high percentage discount to later claim for the payment of their initial value (100%) – …
Read more...They have a high degree of freedom in managing their assets. This freedom can also be used to carry out risk hedging strategies or for the opposite: – …
Read more...The sum of contributions in money delivered by natural and legal persons to a public limited company or administrator, in order to invest it in different types of financial instruments that -...
Read more...The origin of the resources with which the payment of a debt is going to be supported. Examples of sources of repayment are: (1) income from tolls on the – …
Read more...Consumption expenditures made by the public sector, both in the acquisition of goods and services and in the provision of services, subsidies and transfers. Government spending – …
Read more...They are the estimated loss of income by a government that results from granting exclusions, exemptions, deductions, tax credits, preferential rates or deferrals of tax obligations to a category -...
Read more...Expenses that are repeated from year to year and, therefore, are foreseeable. The payroll of public employees, electricity payments, and fixed allowances stipulated by law are examples – …
Read more...Any charge or obligation imposed on real estate or other property. Right of creditors to a certain asset (for example, a house) if the debtor fails to comply – …
Read more...Missing payment on the due date of interest or principal of a loan or other debt securities. When a debtor stops making the payments corresponding to – …
Read more...Stimuli offered to a person, group or sector of the economy in order to increase production and improve yields.
Read more...It is an intangible tool, a service or product offered by a financial institution, intermediary, economic agent or any entity with the necessary authority and power to be able to offer or demand it. His - …
Read more...Also referred to as a debt swap. In its most general form, it is the exchange of debt under terms other than those initially agreed. Could be - …
Read more...Profit or income produced by capital. Payment made for the use of someone else's money received on loan, or collection received for the temporary assignment of one's own money. The interest - …
Read more...In the economic sense, it is a placement of capital to obtain a future profit. This placement supposes an election that gives up an immediate benefit for a future one.
Read more...Value Added Tax. It is imposed at each stage of production and up to the final consumer. It is an indirect tax because it does not have a direct impact on income but falls on -...
Read more...Sales and use tax. The IVU has two components. The first is the sales tax. This is the one that the consumer pays and the merchant charges at the moment – …
Read more...Alternate way of referring to the Fiscal Oversight Board (see Fiscal Oversight Board). Those who use this expression do so to emphasize that the entity is one that controls – …
Read more...Created by the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA), Public Law No: 114-87 adopted by the United States Congress on June 30, 2016. – …
Read more...Law 21 of 2016 allows the Government to postpone the payment of the debt through the declaration by the Legislative Assembly of a fiscal emergency. During the emergency period, – …
Read more...Law 71 of June 28, 2014 establishes the rules that will apply to compliance, repayment and restructuring of debts of public corporations and other instrumentalities of the – …
Read more...They are codes related to navigation on the coasts of the United States and the commerce associated with it. The cabotage laws that apply to Puerto Rico also apply to – …
Read more...Ability of a person or entity to meet its short-term debts by having cash or other assets that can easily be converted into money – …
Read more...They are those where investors put their money to work financing the productive activity of a country. The flow of capital in all national economies passes through a market –…
Read more...Financial market where participants buy and sell debt securities, usually in the form of bonds.
Read more...They are a mechanism to channel the savings of families and companies to investment, in such a way that the people who save have a good remuneration for lending that – …
Read more...Bond insurers that are dedicated solely to this financial service. His goal is to ensure that his clients receive timely payment of interest and principal on their bonds. – …
Read more...It is a risk rating agency that performs international financial research and analysis of commercial and government entities. The company also rates the solvency of the – …
Read more...Term granted to pay an overdue debt. Example of use: "Puerto Rico decreed a moratorium on the payment of the debt of 422 million dollars of the Bank -...
Read more...Variation registered by the production of an economy before a change (increase or reduction) in public spending and/or in taxes.
Read more...Bonds issued by state or municipal jurisdictions or their instrumentalities and agencies.
Read more...It is the amount of money that employees are paid for their services offered and their benefits. Includes total compensation to employees. That is, wages and – …
Read more...Bonds issued by the central government of Puerto Rico whose payment is guaranteed by good faith, good credit and Commonwealth taxes. The pay - …
Read more...Office of Management and Budget. This office was created by the organic law of the Office of Management and Budget (Law No. 147 of June 18, 1980). His - …
Read more...An investment firm that manages investment funds and one of the main creditors of the government of Puerto Rico.
Read more...It is an instrument of the Governor derived from the exercise of executive power by force of law, through which the Governor issues an order to an entity of the Branch -...
Read more...Disbursements that a country is obliged to make and that are not linked to the occurrence of a specific economic event. For example, payments of salaries to civil servants – …
Read more...Latin term that means to be in equal conditions. In the context of a restructuring, it refers to creditors who have the same rank or preference and, therefore, their – …
Read more...Set of assets of a nation accumulated over the centuries, which, due to their artistic, archaeological significance, etc., are subject to special protection by law.
Read more...Committing a possession to obtain credit or loans and to guarantee that a debt will be paid or that an obligation will be fulfilled. When a debt – …
Read more...It is a document that contemplates the treatment of the various kinds of claims by creditors against a municipality. The Bankruptcy Code requires a debtor to file a plan. – …
Read more...It is a budget in which expenses are equal to income. The Constitution of the Commonwealth Article V Section 7 establishes the constitutionality of balanced budgets to the – …
Read more...Set of obligations and resources of the government of Puerto Rico that includes all ordinary operating expenses and permanent improvements charged to the general fund, government contributions of -...
Read more...In the context of a loan, it is the capital that the debtor receives from the creditor. The interest payable is calculated on this amount.
Read more...It is the process through which a government transfers a company or public activity to the private sector.
Read more...Puerto Rico Oversight and Management Economic Stability Act (PROMESA), Public Law No. 224-8 adopted by the United States Congress on June 30, 2016. This law creates a – …
Read more...A measure of the cash flow available to pay current debt obligations. The ratio indicates net operating income as a multiple of debt obligations with – …
Read more...It is a measure of the fair value of asset and liability accounts that can change over time. The market value test is intended to provide a – …
Read more...The discount of the principal of the debt. Also cut or haircut. If the reduction is 20%, the debtor pays only 80% of the principal of the debt.
Read more...Money that the government receives through the different taxes that it imposes on citizens, companies, etc. An example of this would be the IVU, which is a tax set on – …
Read more...Modification of the terms and conditions previously established in a loan or credit. It can include a reduction in the interest rate, a deferral of payment, a change in the term of – …
Read more...Make changes to the terms of payment of the debt. It can include changing the time of payment, the monetary amount of each payment, the interest rate or reducing the – …
Read more...They are measures that modify the fabric of an economy, that is, the institutional and regulatory framework in which companies and individuals operate.
Read more...It refers to the benefits that have been obtained or can be obtained from an investment that has been previously made. Both in the field of investments and in – …
Read more...It is the risk of loss of capital caused by a creditor not making a timely payment. In all financial investments, including operations – …
Read more...Refinancing type. Tactic to postpone the payment of the debt. New long-term debt is issued to pay off maturing bonds. In it - …
Read more...Total disbursements directed to pay the public debt, that of the central government and public corporations. In fiscal year 2015-2016, the consolidated budget for the service of – …
Read more...The services provided by whoever corresponds, either by the government, or by any person, whose interruption would endanger the life, personal safety or health of the – …
Read more...Occurs when a country's current debt plus the current present value of all its present and future expenditures does not exceed the current present value of all its income -...
Read more...Situation in which the borrowing country is expected to continue servicing its debts (see Solvency) without an unrealistically high future correction in – …
Read more...It is an American financial services company. It is a division of S&P Global that publishes reports on financial research and analysis of stocks and bonds. S&P is known for its – …
Read more...It is the result of the difference between what a country enters through taxes and what it spends to pay officials and their public policies. Unlike the surplus to dry, – …
Read more...A proposal to restructure the team of the governor of Puerto Rico Alejandro García Padilla. The superbond consolidates all government debts into a single bond that in the proposal – …
Read more...It is a mechanism that guarantees the repayment of loans and that is different from the provision of formal guarantees by the borrower.
Read more...It refers to the rate that applies to an amount of money in a period of time. The effective rate is always compounded and due, since it is applied – …
Read more...Bond Buyer. Lend money to the institution selling the bond. It is to whom coupons are paid on stipulated dates with the commitment to repay the debt contracted -...
Read more...When an investment company maintains portfolios with different types of bonds or shares, which can result in a conflict at the time of a renegotiation. For example, companies like – …
Read more...Securitization (of bonds, titling, securitization, securitization, mechanism of...) is a mechanism through which interest and principal payments of certain bonds are secured with an asset -...
Read more...It is a section of Law 114 of the Puerto Rico Congress Oversight and Management Economic Stability Act (PROMESA) that establishes the procedure to be followed so that the debtor, in this case –…
Read more...The mechanism established in Title VI of Law 114 of the Puerto Rico Congress Oversight and Management Economic Stability Act (PROMESA) under which the debtors of the government of Puerto -...
Read more...Promissory notes backed with anticipated contributions and income. TRANS are a short-term instrument that must be repaid in full during the last quarter of the fiscal year. Are issued - …
Read more...Puerto Rico Debt Dictionary
With the growing importance of the fiscal situation, the debt and the budget have become topics of discussion in the daily lives of Puerto Ricans.
This dictionary is an effort to compile commonly used terms. Its objective is to achieve a better understanding of the problem and encourage informed citizen participation in these debates.
It is a living and dynamic document. As the debt and budget discussions continue, terms will be added and updated, thus collecting the most up-to-date lexicon.
Tweet or twitter @menchaut or click the question mark next to each term to request terms to be added, suggest changes, or make comments.
Technical notes: To make this dictionary, definitions from financial dictionaries, definitions of terms provided in Puerto Rico government documents, and explanations of concepts available in the printed and Internet news media were taken.
Some terms are presented in English as their use is regularly made in that language and is generally accepted and understood in the language of debt. When necessary, usage examples are provided to clarify the meanings. Hyperlinks are provided to Internet addresses that are used in the construction of the terms. However, it cannot be guaranteed that they will be available at the time the reader tries to access them.
The Debt Dictionary is an education and empowerment tool in times of crisis. Its author is the economist and professor, María E. Enchautegui, who was assisted by Victoria Sofía López Esteves. Sergio Marxuach, Director of Public Policy at the Center for a New Economy, made important contributions.