The IOF tax was 5.38% on loans up to 90 days and no tax at all for longer term loans.
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Plus, they were lending the money short (often only overnight) and the banks taking in those deposits were transforming them into longer term loans to their customers.
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Tesla also announced today that it will provide longer-term loans that considerably reduce monthly payments.
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Longer term dollar loans (over 720 days) are not taxed at those levels.
The intention is that these would be longer-term loans with a maturity of about 10 years, that small businesses find hard to prise out of our risk-averse banks.
It made longer-term loans with so-called conditionalities, i.e.
Now, it is true that the European Central Bank's deeds and words over the past year - the provision of emergency longer-term loans to eurozone banks and an offer of support to governments with clear plans to restore financial credibility - has staunched the worrying drain of funds out of Spanish and Italian banks.
First, this is an attempt at serious structural financial reform to provide longer term, stable loans to smaller businesses, not a quick fix.
He found that the availability of discounted variable-rate deals crowded out comparatively expensive longer-term fixed-rate loans.
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He says he has to rely for financing on short-term bank loans at high interest rates instead of on longer-term bonds.
Faint though it is, there is a glimmer of hope in financial markets: interest rates on short-term loans between banks and on longer-term corporate debt have fallen notably since the autumn, and there has been a flood of new bond issues.
This contributed to banks' and industrial companies' over-reliance on short-term foreign loans, which could no longer be serviced after the currency collapsed last October.
The bank relies on the idea that there will be a continual stream of those short term deposits with which it can finance those much longer loans.
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Short-term loans to carry inventory and buy raw materials are no longer available.
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