Jargon beginning with: s

S.W.I.F.T: Society for Worldwide Interbank Financial Telecommunications. A secure, codified electronic method of communication between banks which subscribe to its system. Widely used between banks to confirm payment details, among other things.

Saibatsu: A term used to describe the large Japanese conglomerates which are made up of industrial companies, trading houses and financial institutions.

SAMA: Saudi Arabian Monetary Agency - the central bank of the Kingdom of Saudi Arabia

Scuttlebutt: Rumour or gossip. Derived from the water container used on board a ship to provide drinking water; the equivalent of today's office water cooler or coffee machine.

SEC: Securities and Exchange Commission - a financial regulator in the United States. "The mission of the U.S. Securities and Exchange Commission," it says, "is to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation."

Secondary Market: Dealing in securities such as bonds or forfaited paper which have already been issued into their Primary market.

Securitisation: The process of transforming financial obligations into tradable securities such as shares or bonds. Bonds backed by mortgages or credit card receivables are well-known examples.

SFA: Securities and Futures Authority now part of the FSA.

Shipped on Deck: When cargo is shipped on the deck of a vessel rather than in the hold, i.e. exposed to the elements. This is may appear as a Clausing on a Bill of Lading.

SIFI: The Financial Stability Board (FSB), the super regulator coordinating the work of national and international financial regulators and standard setting bodies, defines SIFIs as financial institutions whose “…disorderly failure, because of their size, complexity and systemic interconnectedness, would cause significant disruption to the wider financial system and economic activity.” In other words organisations that are too big to be allowed to fail.

Sight Draft: A Bill of Exchange payable immediately as opposed to a Usance bill.

Silent Confirmation of Letters of Credit: A bank or other party which it is not a party to an L/C confirms to the Beneficiary of that L/C that it will pay if conforming documents are presented to the bank issuing the L/C. The Issuing Bank will not be aware of this arrangement. SMEs Small and Medium-sized Enterprises.

SLC: See 'Standby Letter of Credit'.

Soft Commodity: While there is no formal definition of this term it is widely taken to mean coffee, cocoa, sugar and cotton but not agricultural commodities such as wheat and potatoes, and not industrial commodities, chemicals and metals.

Solvency II: Solvency II is a body of European regulation for governing insurance companies. It covers issues such as how insurance companies are to calculate their liabilities, how much cash or short term assets they need to hold, what form their core capital should take and how appropriate their internal systems are for controlling their businesses.

Sovereign Borrower / Guarantor: Government borrower or guarantor.

Sovereign Risk: See 'Country Risk'.

SPE / SPV: Special purpose entity / special purpose vehicle - a limited company set up for a specific narrow purpose, such as to own particular assets or to legally isolate certain activities from a parent company or private individual.

Spread: Risk margin as applied of loans and discounts.

SRO: Self-Regulating Organisation e.g. IMRO, SFA, PIA etc.

SSAP: Statements of Standard Accounting Practice.

Stale Bill of Lading: A bill of lading which has been presented under a Letter of Credit but is older than 21 days since its date of issue.

Standby Letter of Credit: A Letter of Credit, similar to an on-demand guarantee, under which drawings are contingent upon a particular event or set of circumstances occurring or failing to occur.

STIR: Short-Term Interest Rate.

STP: Straight Through Processing – the electronic, automated handling of capital markets transactions from beginning to end.

Straight Discount: A method of calculating a discount commonly used in Forfaiting. The result of a straight discount is expressed as percentage of the discounted Face Value of future cashflows.

Stress test: This term has come to be applied to the tests to which the financial structures of banks are subjected, in order to establish whether they are able to withstand certain types of financial crises or other shocks.

Subparticipation Agreement: An agreement by which banks may sell to other banks pieces or "participations" in loans that they make to borrowers. Under a "silent subparticipation agreement" other parties to the main agreement such as the borrower or other members of a lending Syndicate will be unaware of the existence of the subparticipation arrangements.

Sukuk: An Islamic bond which is similar to an "asset backed securitisation" and entitles the sukuk holder to share in the profits of the pool of underlying transactions.

SVR: Standard variable rate - the jargon used by banks or building societies to denote the rate at which they normally lend money, particularly in the form of mortgages

SWF / Sovereign Wealth Fund: a nation's pool of funds and assets built up from its surpluses. Often, though not exclusively, used by mineral rich countries such as Dubai, Abu Dhabi, Norway etc. to provide for their countries' future needs.

Switch Trading: Using outstanding credit balances in bi-lateral trading accounts between two countries to finance imports from third parties.

Syndication: A loan made by a group or "syndicate" of banks.