Marketable Securities
What does it mean
Marketable Securities means the total dollars invested in securities (fancy way of saying investments) that are readily sellable on the open market. Examples of marketable securities would be stocks, bonds and mutual funds.
Why does it matter
Marketable Securities matter to a banker for two primary reasons: Liquidity and Collateral.
From a liquidity perspective, Marketable Securities represent an easy to tap source of liquidity if either the borrower or guarantor needs to inject money in. A borrower/guarantor may need to tap marketable securities in the event of business losses, business expansion or equipment purchase.
The second reason Marketable Securities matter to a banker is that they could be a potential source of collateral or down payment.
Please note that when I talk about marketable securities, I am NOT talking about securities held with a retirement type of account (401K, IRA, SEP, etc). These sources of liquidity are not as easy to tap like a non-tax preferred account because there are potential tax and penalties if funds are withdrawn (the penalty part typically goes away once the person is over 59.5 years old).
Other Relevant Terms
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Greetings! I'm Clay Sharkey, and there is nothing I like more than assisting others in achieving their goals. I firmly believe that by enhancing a banker's understanding of their customer's' business, they can provide superior service. This superior service, in turn, leads to stronger relationships for the bank, improved performance for the businesses, and better experiences for our communities. Win-win-win.
