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24.10.2008 Business & Finance

Investment term of the dayFull Faith And Credit

By Stephen Odoi Larbi - Ghanaian Chronicle
A phrase used to describe the unconditional guarantee or commitment by one entity to back the interest and principal of another entity's debt.

This full faith and credit commitment is typically employed by a government to help lower the borrowing costs of a smaller, less stable government or a government-sponsored agency. When this occurs, the smaller government or agency takes on the backer's credit quality.
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