# The Core Glossary

> 26 terms from the Banking & Lending book's The Core part, each defined in a line and linked to the chapter that explains it.

- **APY earned:** the yield an account actually earned over a statement period, from the interest paid and the average daily balance, shown on the periodic statement ([Interest, APY & Statements](https://www.syntaqx.com/books/banking-and-lending/interest-and-statements#apy-earned-the-statement-formula)).
- **Average daily balance method:** interest computed by applying a periodic rate to the average of the period's daily balances; with the daily balance method, one of the two Regulation DD allows ([Interest, APY & Statements](https://www.syntaqx.com/books/banking-and-lending/interest-and-statements#balance-methods)).
- **Bank Service Company Act:** the statute making services a bank buys by contract, such as a hosted core, examinable as if the bank performed them itself (12 USC 1867) ([Core Banking Systems](https://www.syntaqx.com/books/banking-and-lending/core-banking-systems#hosted-in-house-and-cloud-native)).
- **Batch core:** a core that memo posts during the day and hard posts, accrues and rolls the business date in a nightly batch ([Core Banking Systems](https://www.syntaqx.com/books/banking-and-lending/core-banking-systems#batch-cores-and-real-time-cores)).
- **Block (deposit account):** a reduction of available balance that lasts until someone releases it, as for legal process or fraud, as opposed to a hold that expires ([Posting, Holds & Balances](https://www.syntaqx.com/books/banking-and-lending/posting-holds-and-balances#holds-and-blocks)).
- **Booking date, value date:** when an entry posts to the books, and the date it counts from for interest, fees and availability; a backdated correction has a past value date and today's booking date ([Posting, Holds & Balances](https://www.syntaqx.com/books/banking-and-lending/posting-holds-and-balances#effective-dates-and-backdating)).
- **Change in terms:** a change to a disclosed account term; adverse changes to consumer deposit terms need 30 days' notice (Reg DD) and significant changes to open-end credit 45 (Reg Z) ([Products & Product Configuration](https://www.syntaqx.com/books/banking-and-lending/product-configuration#changing-terms-on-existing-accounts)).
- **Coexistence:** running two cores at once during a progressive migration, with each account's system of record held as data and every integration routing by it ([Core Modernization & Conversions](https://www.syntaqx.com/books/banking-and-lending/core-modernization#coexistence-and-the-system-of-record)).
- **Compounding:** interest earning interest, at crediting or daily on accrued interest; the disclosed APY must reflect the frequency the account uses ([Interest, APY & Statements](https://www.syntaqx.com/books/banking-and-lending/interest-and-statements#compounding)).
- **Conversion (core):** moving an institution's accounts, history and obligations in flight from one core to another, usually over a weekend after rehearsals ([Core Modernization & Conversions](https://www.syntaqx.com/books/banking-and-lending/core-modernization#conversion-weekends)).
- **Core banking system:** the system of record for an institution's accounts, postings and general ledger, usually a vendor's product hosted by the vendor ([The Banking Landscape](https://www.syntaqx.com/books/banking-and-lending/banking-landscape#how-the-platforms-do-it)).
- **Crediting (interest):** moving accrued interest into the account's balance, where it becomes spendable and, for tax, paid; rounding happens here, once ([Interest, APY & Statements](https://www.syntaqx.com/books/banking-and-lending/interest-and-statements#accrual-is-daily)).
- **Day count convention:** the rule that turns an annual rate into a daily one: Actual/365, Actual/360, 30/360 or Actual/Actual ([Interest, APY & Statements](https://www.syntaqx.com/books/banking-and-lending/interest-and-statements#day-count-conventions)).
- **End of day (EOD):** the ordered sequence that closes a business date: hard posting, item fees, accrual, date-driven events, snapshots, GL proofs, files out and the date roll ([Posting, Holds & Balances](https://www.syntaqx.com/books/banking-and-lending/posting-holds-and-balances#end-of-day-and-the-business-date)).
- **Float:** deposited items credited to the ledger but not yet collected from the paying bank; ledger balance minus float is the collected balance ([Posting, Holds & Balances](https://www.syntaqx.com/books/banking-and-lending/posting-holds-and-balances#three-balances)).
- **GL mapping:** the configuration that says which general ledger accounts each kind of activity on each product version debits and credits ([Core Banking Systems](https://www.syntaqx.com/books/banking-and-lending/core-banking-systems#the-general-ledger-and-its-subledgers)).
- **Grandfathering:** leaving existing accounts on an older product version when the product changes ([Products & Product Configuration](https://www.syntaqx.com/books/banking-and-lending/product-configuration#grandfathering)).
- **Hard posting:** recording a transaction in the ledger with its journal entry, final except by reversal ([Posting, Holds & Balances](https://www.syntaqx.com/books/banking-and-lending/posting-holds-and-balances#memo-posting-and-hard-posting)).
- **Memo posting:** recording an item that changes available balance before it reaches the ledger, such as a card authorization or a deposit under review ([Posting, Holds & Balances](https://www.syntaqx.com/books/banking-and-lending/posting-holds-and-balances#memo-posting-and-hard-posting)).
- **Posting order:** the order a core posts a day's items in, which decides how many overdraw an account near zero; high-to-low ordering was the subject of the overdraft litigation ([Posting, Holds & Balances](https://www.syntaqx.com/books/banking-and-lending/posting-holds-and-balances#posting-order)).
- **Product factory:** the part of a core that defines products: rates, tiers, fees, limits, maturity, dormancy and GL mapping ([Products & Product Configuration](https://www.syntaqx.com/books/banking-and-lending/product-configuration#the-product-factory)).
- **Progressive migration:** replacing a core in slices (by product, by component, or greenfield beside it) rather than in one big-bang conversion ([Core Modernization & Conversions](https://www.syntaqx.com/books/banking-and-lending/core-modernization#big-bang-or-progressive)).
- **Real-time core:** a core that hard posts each transaction as it happens, keeping end of day for accrual, fees and statements ([Core Banking Systems](https://www.syntaqx.com/books/banking-and-lending/core-banking-systems#batch-cores-and-real-time-cores)).
- **Subledger proof:** the daily check that the sum of account balances on a product equals its GL control line ([Core Banking Systems](https://www.syntaqx.com/books/banking-and-lending/core-banking-systems#how-to-build-it)).
- **Subledger:** per-account detail beneath the general ledger, which must sum to the GL's balances every day ([The Banking & Lending Business](https://www.syntaqx.com/books/banking-and-lending/banking-business#the-core-data-model)).
- **Tiering method A, B:** Regulation DD's two tiered-rate shapes: the whole balance earns its tier's rate (A), or each slice earns its own tier's rate (B) ([Interest, APY & Statements](https://www.syntaqx.com/books/banking-and-lending/interest-and-statements#balance-methods)).

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