Glossary

General Glossary

I

IBAN  

International Bank Account Number. The IBAN (International Bank Account Number) standard was created to help banks automate transfers within the European Union (EU), in such a manner that intra-Community payments are assimilated to national payments and the same charges can be applied. Until approval of the EU regulation on cross-border payments in euros, account numbering systems were strictly national and the country of origin of an account could not be identified. The IBAN adds four characters in front of each number: two letters that identify the country and two control digits to avoid transcription errors. In order for an intra-Community transfer to be subjected to the same charge as a national transfer of identical amount, the originator must provide the bank with the beneficiary's IBAN and BIC (Bank Identifier Code).

Iberclear 

A company set up by the SCLV (Spanish Settlement and Clearance Service) and the Banco de España that, after the approval of the Law on Reform Measures of the Financial System, unifies the management of the securities register, clearing and settlement systems on a national level. Before said Law, the SCLV was in charge of the register, clearing and settlement of the AIAF Bond Market and the stock markets, while the Banco de España managed the Public Debt Market Book-Entry System (CADE) on behalf of the Treasury.

Implied volatility 

Expected volatility (i.e. the standard deviation) in the price variation rates of an asset (e.g. shares or bonds). It can be obtained from asset prices, the expiry date and the strike price of their options, as well as from a risk-free rate of return, using an option pricing model such as the Black-Scholes.

Index  

To link the interest rate applied to a credit operation or deposit to the remuneration of a financial instrument or a specific index (for example, the CPI, a Stock market index, the Euribor, etc.).

Indexed loan  

A loan whose interest rate is linked to the evolution of a specific index or to the remuneration produced by a specific financial instrument.

Index of labour costs per hour 

A measurement of labour costs including gross wages and salaries (in cash and in kind, including variable salary components) and other labour costs (social contributions made by the employer plus taxes related to employment paid by the employer, minus grants received by the employer) per hour worked (including overtime).

Industrial producer prices 

The factory-gate price (transportation costs are not included) of any product, excluding imports, sold by industry excluding construction on the domestic markets of the euro area countries. Imports are not included.

Industrial production 

The gross value added created the industry at constant prices.

Inflation 

An increase in the general price level, for example, in the consumer price index.

Infrared properties 

The properties of a material which can only be read under infrared light (long wavelength). Euro banknotes specifically incorporate infrared properties.

Ink jet printer 

A printer that places droplets of ink onto the paper to create the image to be reproduced.

Inseparable colour pairs 

Two colours which, individually and at first sight, are different, but on being printed side-by-side cannot be told apart. They are difficult to separate when attempting to reproduce them using conventional photographic techniques. They look identical when photocopied. Some banknotes use inseparable colour pairs as security elements.

Intaglio printing 

A form of raised printing. It is performed with a flat, steel plate which contains an image on which the parts that must have ink are etched by hand or mechanically. The low reliefs are filled with a high viscous ink. The surface is cleaned of ink and the plate is applied to the paper at very high pressure. This transfers the ink from the spaces in the plate to the paper. The image is characterised for its raised nature, produced by a combination of the permanent deformation of the paper and a thick layer of ink. On banknotes, the main motif is printed by intaglio printing. Several elements on the obverse of euro banknotes are printed by intaglio printing.

Intaglio printing 

This is the printing of raised images on a print substrate. During calcographic printing, the substrate (which can be paper) is printed at high pressure to produce a relief image on it. On euro banknotes, there are several calcographic elements; for example, the face value of the note.

Intaglio scanning and recognition device 

An optical detection system capable of determining the presence of intaglio printing on a banknote.

Interbank market 

An organised market that settles its operations through the Banco de España Settlement System (SLBE). Its main function is to enable the transfer of funds between banking institutions, contributing to the transmission of monetary policy. There are several trading segments in the interbank market: deposits, repurchase transactions, securities and derivatives.

Interest rate 

The price of money. It can be defined as the sum that is paid to obtain an amount of money as a loan (or which is received for lending it), expressed as a percentage of this amount.

International investment position  

The value and composition of an economy's financial assets and liabilities compared to the rest of the world.

International reserves 

Foreign assets controlled by monetary authorities, which can be immediately accessed to directly finance or regulate the magnitude of disequilibrium in payments through the intervention of foreign currency markets. International reserves in the euro area are comprised of claims not denominated in euros on non-euro residents, gold, special drawing rights and IMF reserve positions held by the Eurosystem.

Internet banking 

A banking operating procedure that uses internet as an instrument for marketing and communication with clients. The client does not need to go to a branch to consult their balance or carry out operations; they only need a computer with internet access and a password that allows the institution to authenticate their identity.

Interpol 

The name by which the International Criminal Police Organisation is known. Its origin dates back to 1923. Its action extends to all kinds of breach of law, particularly those related to drug and gold trafficking, counterfeiting and capturing criminals in a foreign country. Police from most of the countries in the world participate in Interpol. The European Central Bank has signed a collaboration agreement with Interpol to fight against the counterfeiting of euro banknotes.

Intraday credit 

Credit extended and reimbursed within a single day. The national central banks can extend these credits to speed up the use of TARGET, balancing mismatches in the settlement of payments. They may be in the form of a guaranteed overdraft, a credit operation pledged by available collateral or a repurchase agreement.

Invalidation 

Process by which a central bank transforms the banknotes it considers unsuitable for circulation into non-valid.

Investment fund  

Asset with no legal personality created through the contributions of multiple investors. The management company that exercises the administration and representation of the fund is in charge of investing these contributions in different financial assets and instruments, whose evolution in the markets determines the positive or negative results obtained by the investors or unit-holders. The minimum investment unit is the share. The securities in which the fund invests are held by a depository, usually a credit institution, that also watches over the management company for the unit-holders. There are different types, according to the asset in which the investment is made: fixed income, variable income or mixed. Among the fixed income type, currency funds or FIAMM (Money Market Investment Fund) invest in short-term money market assets (bills up to 18 months). On the other hand, capital market funds can invest in variable as well as fixed income assets, without limit to the maturity period.

Iridescence 

"The brightness of a material, that produces a change of colour depending on the angle of vision and of the illumination. The name comes from the Greek iris which means rainbow. In this context the expression ""optically variable"" is also used. Iridescence is based on light diffraction and interference."

Iridescent ink 

Ink with fluctuating shine and colour depending on the viewing angle and lighting. In this respect, iridescent inks differ from typical printing inks, which have a shine and colour that is the same regardless of the viewing angle or lighting. Iridescent inks are useful for banknote security because their optical effect cannot be imitated by colour copiers. There are various types of iridescent ink: Metallic ink, pearlescent ink and optically variable ink.

Iridescent stripe 

5€, 10€ and 20€ notes have a vertical band printed on their reverse in iridescent ink which changes colour depending on the viewing angle and the angle of illumination. The iridescent stripe makes it easier for the general public to authenticate their banknotes.

Issuing entity 

A credit institution which provides, generally to a current account holder thereof, a payment card, whether credit, debit or cash. Operations performed using said payment instrument will normally be settled in the account designated by the card holder for such purpose from among those held with the issuing entity.