nonrecourse sale of bank receivables to a third party, either through the sale of whole loans or whole pools of loans, or securitization, that is, issuing securities collateralized by the receivables of bank credits (residential mortgages, auto loans, leases, credit card receivables). Accounting treatment of asset sales is complicated, and determines whether a transaction is a sale of assets. In general terms, the test of an asset sale is whether the seller gives the buyer control over the assets transferred, and also any residual interest, without recourse to the seller. Transfers with recourse-allowing the buyer to resell a portion of the assets back to the seller-are treated by Financial Accounting Standards Board Rule 77 as a financing rather than a sale of assets.

If the agreement requires the seller to take back any bad loans, it is not considered for accounting purposes a true sale of assets and the seller cannot deduct the value of loans sold from its loan portfolio.

signature on a draft or check by a payee before transfer to a third party. A payee provides such an endorsement when transferring this draft to the payee's bank. Checks can be endorsed in three different ways. In a blank endorsement, once signed, it becomes a negotiable instrument and can be used as such by anyone. A restrictive endorsementlimits the use of the check to a single purpose. "For deposit only" is written on a check when it is deposited by mail. If the check is lost in the mail and subsequently found, it cannot be cashed. A special endorsementis used to pay someone else. All that is required is to indicate the payee and sign.