Account debtor

The account debtor is the individual or legal entity, either Italian or foreign, that entered or will enter into commercial dealings with the invoice seller and is therefore obliged to pay the supplier one or more receivables.

Book value per share

The Book Value per Share (BVPS) is a measure of equity expressed in monetary terms with reference to each share. It is obtained from the ratio between the book value of equity and the number of outstanding ordinary shares.

Cassa Compensazione e Garanzia

Cassa di Compensazione e Garanzia (CC&G) is an Italian Joint-Stock Company belonging to the London Stock Exchange Group. It ensures contracts relating to listed securities and transactions in futures and options, as well as on the NEW MIC, the interbank collateralised deposits market, are properly cleared and settled. CC&G therefore eliminates counterparty risk, acting as buyer in relation to the seller and vice versa, guaranteeing the successful performance of contracts.

Cost of credit quality

The cost of credit quality expresses the quality of loans to customers and is calculated as the ratio between the value adjustments on annualised credit and the receivables due from customers at year’s end: the lower the ratio, the less risky the bank's assets.

Eligible assets

In the Eurosystem’s refinancing transactions, eligible assets are securities that meet the eligibility requirements established by the European Central Bank for use as collateral to obtain liquidity. The list of eligible assets is published on the ECB website and is updated several times each month.


A measure of the earnings a company generated in proportion to the number of shares issued by said company. It is calculated as the ratio of net profits to the average number of outstanding issued shares net of treasury shares.


The Eurosystem includes the European Central Bank and the National Central Banks of the EU Member States which adopted the Euro in the Third Phase of the Economic and Monetary Union (EMU). Currently, fifteen national central banks participate in it. It is headed by the ECB’s Governing Council and Executive Board. 

Invoice seller

The invoice seller is the factoring contract’s counterpart who pledges to transfer to a factor all the receivables derived or deriving from its business operations conducted vis-à-vis another entrepreneur (account debtor).

The electronic wholesale market for government bonds (MTS) is a platform for trading Italian or foreign government bonds and state-guaranteed securities on the secondary market. The MTS market is reserved for professional investors. Bids may be made for minimum quantities of 2.5 million and depending on the instrument. The MTS is structured in the cash (spot trading), repo (repurchase trading), and coupon stripping (separate trading of strips) segments.


The New MIC is the segment of the e-MID (the electronic market for interbank deposits) dedicated to deposits in Euro with maturities up to a year. If features the New MIC Guarantee System managed by Cassa di Compensazione e Garanzia. Trades, which are settled in Target2, are carried out anonymously with protection against counterparty risk. The guarantee is provided by the collateral pledged by each member; a mutual insurance scheme, consisting of 10% of the collateral pledged by each member; and the interposition of CC&G between the counterparties for each concluded contract.

Non-performing loans

Cash and off-balance-sheet loans due from a party in default (even when not confirmed in judicial terms) or in broadly similar situations, regardless of losses estimated by the bank.

Non-recourse factoring

In non-recourse factoring, the seller transfers to the factor a receivable without offering any guarantee should the debtor default. The seller therefore guarantees the factor only the existence of the receivable sold, and not the debtor's solvency.

Outright purchases

With outright purchases, the factor entirely assumes the debtor's risk of default: therefore, it does not finance the receivable, but rather purchase it in full. The sum paid out to the invoice seller in this case is not an advance on the consideration, but the final collection of the credit, and therefore is not a liability for the invoice seller.

Performing loans

A receivable held by the bank due from customers deemed solvent and therefore able to promptly repay their debt as agreed.

Past due loans

Cash and off-balance sheet loans, other than those classified as non-performing, substandard or restructured loans, that are past due or have been overdrawn for more than 90 days as of the reference date.

Recourse factoring

In recourse factoring, the seller transfers to the factor a receivable guaranteeing the debtor will repay it. The seller therefore guarantees the factor both the existence of the receivable sold and the debtor's solvency.

Regulatory capital

Regulatory capital is the first protection against risks associated with the banking business. It is the algebraic sum of a series of positive and negative elements which, based on their acknowledged capital quality, may be included in the calculation, albeit with certain limitations. The bank must fully own the positive elements of which the capital is composed, so as to use them without restraints to hedge risks and losses. The amount of these elements does not include any fiscal expenses. Regulatory capital consists of Tier I and Tier II capital, net of deductions.

Restructured loans

Cash and off-balance-sheet loans for which a bank, because of the deteriorated economic-financial condition of the debtor, agrees to modify the original terms and conditions resulting in a loss.


Return on Assets (ROA) is and indicator that measures the profitability of the invested capital or the business carried out. It is the ratio between gross profit and total assets.


Return on Core Assets (ROCA) is an indicator of the profitability of the assets dedicated to the core business. It is calculated as the ratio between gross profit minus net earnings on debt securities and the total assets excluding debt securities.

RWA (Risk Weighted Assets)

Risk weighted assets are cash and off-balance-sheet assets (derivatives and guarantees) classified and weighted based on several risk-related ratios, in accordance with bank regulations issued by the supervisory authorities concerning solvency ratios.


Solvency is a debtor's capacity to meet its obligations.

Substandard loans

Cash and off-balance-sheet loans to entities in a temporary state of objective difficulty which can be overcome in a due period of time. Substandard loans also include the so-called “objective substandard loans” in accordance with Bank of Italy’s regulations.

Tier 1 capital

Tier I capital is composed of the following elements defined by Bank of Italy as being of primary quality: paid-in share capital, reserves, the provision for general banking risks, and innovative capital instruments. The sum of these elements, after deducting treasury shares, goodwill, intangible assets, and losses recognised in previous financial years and in the current one, represents the Tier 1 capital.

Total receivables

The sum of outstanding receivables purchased by the factor as of a specific date.


Turnover is the gross flow of the receivables sold by the customers to the factoring company in a specific period of time (for instance, one year).