The vocabulary of structured credit.

A

AML/CFT

Anti-money laundering and countering the financing of terrorism. The set of policies, controls and mandatory reports for institutions that operate in financial and capital markets.

Acceleration

Events set in the indenture that allow the debentures to be declared immediately due — such as issuer default — protecting noteholders.

Amortization

Payment of portions of the principal (face amount) of the debentures over the tenor, according to the indenture schedule.

Assignee

The party that receives the credit rights in an assignment. In securitization transactions, it is the securitization company itself.

Assignment of credit

A legal act by which the creditor transfers to a third party its rights over a credit (Articles 286 to 298 of the Brazilian Civil Code). In securitization, it is the instrument that takes the receivables from the assignor to the securitization company.

Assignor

The company that transfers (assigns) its credit rights to the securitization company in exchange for immediate funds. In credit operations, it is usually the institution that originated the loans.

C

CCB — Bank Credit Note

A credit instrument issued by an individual or a legal entity in favor of a financial institution, representing a promise to pay. It is an extrajudicial enforceable title, circulates by endorsement and is governed by Law No. 10.931/2004.

CDI

Interbank Deposit Certificate. Its average daily rate is a widely used benchmark for indexing the yield of Brazilian fixed-income securities.

Collateral

The pool of credit rights that supports the issued securities. It is the source of the funds that pay yield and amortize investors — which is why collateral quality is decisive for transaction risk.

Court-ordered claim

A payment requisition issued by the Judiciary so that the Federal Union, states, the Federal District or municipalities can settle final court judgments, under Article 100 of the Federal Constitution.

Credit rights

Rights to receive amounts arising from operations already performed or contracted: loan installments, installment sales, rents, court judgments and others. They are the raw material of securitization.

D

DCM — Debt Capital Markets

The debt capital markets: structuring and distribution of instruments such as debentures, commercial notes, CRI, CRA and other private-credit securities.

Debenture

A debt security issued by a stock corporation that gives the holder (noteholder) a credit right against the issuer on the terms of the indenture (Law No. 6.404/1976, Articles 52 et seq.).

Default

Delay or failure to pay an obligation on the contracted due date. In credit portfolios, it is often measured by delinquency buckets (over 30, 60 or 90 days).

Due diligence

Prior legal, documentary, financial and operational review of the assignor and the credit rights before acquisition.

E

Eligibility criteria

Requirements each credit right must meet to be acquired and linked to an issuance — such as product type, tenor, rate, obligor profile and documentation. They are set in the indenture.

F

FIDC

Credit Rights Investment Fund: a vehicle that invests predominantly in receivables, regulated by the CVM. It is an alternative to securitization through a securitization company.

Fiduciary regime

A mechanism under Law No. 14.430/2022 by which the credit rights linked to an issuance are segregated from the securitization company’s general estate and dedicated exclusively to payment of the respective investors.

G

Granularity

Spreading collateral across a large number of obligors with low individual amounts, reducing dependence on the performance of any single debtor.

I

Indenture

The document that formalizes the debenture issuance and defines all of its terms: amount, series, tenors, yield, security, collateral, acceleration events and issuer duties. It prevails over any informational material.

K

KYC — Know Your Customer

The set of procedures to identify and qualify customers and counterparties, required by anti-money-laundering rules (Law No. 9.613/1998 and CVM Resolution No. 50/2021).

N

Noteholder

The holder of debentures. It is the creditor of the issuing company, with the right to receive yield and amortization on the terms set in the indenture.

O

Obligor

The original debtor of the credit right — for example, the borrower of a payroll loan or the public entity that owes a court-ordered claim.

Origination

The stage at which credit is created: prospecting, underwriting, grant, documentation and registration. Taking part in origination allows control of eligibility criteria and the documentary quality of the collateral.

Overcollateralization

A credit-enhancement mechanic in which the value of the linked credit rights exceeds the value of the issued securities, creating a buffer against default.

P

PEP — Politically Exposed Person

A public official who holds or has held, in the past five years, relevant public office, employment or functions, as well as their family members and close associates. Enhanced diligence is required.

Payroll deduction limit

The maximum percentage of pay or benefit that may be committed to payroll-loan deductions, defined in law and in the specific rules of each paying arrangement.

Payroll loan

A loan product in which installments are deducted directly from the borrower’s payroll or benefit, which significantly reduces default risk.

Private credit

Investments in debt securities issued by companies and non-government vehicles, whose risk depends on the issuer’s ability to pay and on the quality of the collateral.

Private placement

Distribution of securities to a restricted, identified group of investors with a prior relationship with the issuer, without a public selling effort and without registration of a public offering with the CVM.

Professional investor

A category defined by CVM Resolution No. 30/2021 that includes financial institutions, funds and individuals with financial investments above R$10 million who attest to that condition.

Public offering

Distribution of securities with a selling effort directed at the general public — through ads, the internet or broad solicitation — which requires registration or a specific CVM process (CVM Resolution No. 160/2022).

Q

Qualified investor

A category defined by CVM Resolution No. 30/2021 that includes, among others, individuals with financial investments above R$1 million who attest to that condition in writing.

R

RPV — Small-value requisition

A form of payment of lower-value court judgments against the public sector, with a shorter payment timeline than a court-ordered claim (precatório).

Recourse

The assignor’s commitment to stand behind the solvency of assigned credits, by repurchasing or replacing them in case of default, as agreed.

Registrar

An entity authorized by the Central Bank or the CVM to register financial assets and securities, providing publicity, traceability and prevention of duplicate assignments.

S

Securitization

A transaction in which credit rights (amounts receivable) are acquired by a securitization company and linked to the issuance of securities whose payment depends on those cash flows. In Brazil it is governed by Law No. 14.430/2022.

Securitization company

A stock corporation whose purpose is to acquire credit rights and issue securities backed by them — such as debentures, CRI and CRA. It is the bridge between the party that originates the credit and the party that provides the funds.

Segregated estate

The pool of credit rights, security and funds allocated to an issuance under a fiduciary regime. It does not answer for other debts of the securitization company and is administered for the benefit of the security holders.

Series

A subdivision of the same debenture issuance. Different series may have different tenors, yield mechanics, minimum amounts and payment priorities.

Subordination

A structure in which a series or class is paid only after another, senior series. The junior tranche absorbs losses first, protecting senior investors.

T

Trustee

The institution that represents the community of noteholders vis-à-vis the issuer, monitoring compliance with the indenture and protecting investors’ interests.

W

Worker Credit

A payroll-loan program for privately employed workers with a formal contract, operated through eSocial and Dataprev, introduced by Provisional Measure No. 1.292/2025 and converted into Law No. 15.179/2025.