The first-ranking loan with priority claim on cash flows and collateral.
Related terms
- Subscription line
A short-term revolving credit facility secured against LPs' undrawn commitments, used to fund deals quickly and defer capital calls; it can flatter reported IR…
- Sukuk
Sharia-compliant certificates representing fractional ownership in an underlying asset or project and paying returns from its income rather than interest; a ma…
- Takaful
Sharia-compliant cooperative insurance where participants pool contributions to cover each other's losses, avoiding the interest and uncertainty of conventiona…
- Tranche
A slice of a financing or securitisation with its own risk, return, and priority of repayment; senior tranches are paid first, junior tranches carry more risk…
- Weighted average cost of capital (WACC)
The average rate a project must earn to satisfy all its capital providers.
- Working capital
Current assets minus current liabilities; the short-term liquidity a business or project needs to fund day-to-day operations before longer-term cash flows arri…
- Amortisation
The gradual repayment of loan principal over time through scheduled payments.
- Balloon payment
A large lump-sum principal repayment due at the maturity of a loan that was only partially amortised over its term, forcing a refinancing or sale.