Dictionary:
net·ting (nĕt'ĭng)  |
- An openwork fabric; a net.
- The act or process of making a net.
- The act or process of fishing with a net.
netting
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| Investment Dictionary: Netting |
1. Settling mutual obligations at the net value of a contract as opposed to its gross dollar value.
2. Reducing the transfer of funds between subsidiaries to a net amount.
Investopedia Says:
Netting often occurs in situations where one of the participants is experiencing extreme financial difficulty, such as bankruptcy.
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| Banking Dictionary: Netting |
Written contract to settle mutual obligations at the net value of the contracts, as opposed to the gross dollar value. Thus, two banks owing each other $10 million and $12 million, respectively, might agree to value their mutual obligation at $2 million (the net difference between $10 million and $12 million) for accounting purposes. There are various forms of netting in banking: bilateral netting, an agreement by two parties to settle contracts at net value; multilateral netting, a netting arrangement with a third party acting as a central clearinghouse; and netting by novation, in which a new agreement replaces an existing contract. See also Novation.
| Wikipedia: Netting |
- This page is about the finance term. For the fabric called netting see Net (textile).
In general, netting means to allow a positive value and a negative value to set-off and partially or entirely cancel each other out.
In the context of credit risk, there are at least three specific types of netting:
- Close-out netting: In the event of counterparty bankruptcy or any other relevant event of default specified in the relevant agreement which if accelerated (i.e. effected), all transactions or all of a given type are netted (i.e. set off against each other) at market value or if otherwise specified in the contract or if it is not possible to obtain a market value at an amount equal to the loss suffered by the non-defaulting party in replacing the relevant contract. The alternative would allow the liquidator to choose which contracts to enforce and which not to (and thus potentially "cherry pick"). There are international jurisdictions where the enforceability of netting in bankruptcy has not been legally tested.
- Netting by novation: The legal obligations of the parties to make required payments under one or more series of related transactions are canceled and a new obligation to make only the net payments is created.
- Settlement or payment netting: For cash settled trades, this can be applied either bilaterally or multilaterally and on related or unrelated transactions.
Netting decreases credit exposure, increases business with existing counterparties, and reduces both operational and settlement risk and operational costs.
In the context of pollution control, netting refers to a procedure whereby a company can create a new pollution source only if it makes equal reductions in pollution elsewhere in the company, i.e. it cannot acquire new permits from the outside.
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| Translations: Netting |
Dansk (Danish)
n. - net, netværk, netfiskeri, filering
Nederlands (Dutch)
net(werk), gaas, het netten maken, het vissen met een net
Français (French)
n. - filet, grillage, (Tex) voile, tulle
Deutsch (German)
n. - Geflecht, Netz, Knüpfen, Netzstricken
Ελληνική (Greek)
n. - δικτύωμα, πλέγμα, δικτυωτό
Português (Portuguese)
n. - rede (f), malha (f), tela (f), peneira (f)
Русский (Russian)
плетение сетей, ловля рыбы сетью, сетка
Español (Spanish)
n. - redes, fabricación o colocación de redes
Svenska (Swedish)
n. - nätknytning, nät, nätverk
中文（简体）(Chinese (Simplified))
网, 网鱼, 结网
中文（繁體）(Chinese (Traditional))
n. - 網, 網魚, 結網
日本語 (Japanese)
n. - 網, 網細工, 網を編むこと, 網打ち漁, 網漁
العربيه (Arabic)
(الاسم) التشبيك : صنع الشباك, شبكه
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 | Dictionary. The American Heritage® Dictionary of the English Language, Fourth Edition Copyright © 2007, 2000 by Houghton Mifflin Company. Updated in 2007. Published by Houghton Mifflin Company. All rights reserved. Read more |
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| Investment Dictionary. Copyright ©2000, Investopedia.com - Owned and Operated by Investopedia Inc. All rights reserved. Read more |
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| Banking Dictionary. Dictionary of Banking Terms. Copyright © 2006 by Barron's Educational Series, Inc. All rights reserved. Read more |
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| Thesaurus. Roget's II: The New Thesaurus, Third Edition by the Editors of the American Heritage® Dictionary Copyright © 1995 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. Read more |
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| Wikipedia. This article is licensed under the GNU Free Documentation License. It uses material from the Wikipedia article "Netting". Read more |
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| Translations. Copyright © 2007, WizCom Technologies Ltd. All rights reserved. Read more |
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