A _____ is a loan between a parent and its subsidiary channeled through a financial intermediary, usually a large international bank.

Question

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A fronting loan is a type of loan where a parent company borrows funds from a financial institution and then lends the funds to its subsidiary through the same institution. This type of loan is also known as a back-to-back loan. The loan is "fronted" by the bank, which acts as an intermediary between the parent and subsidiary companies. The fronting loan is a common way for multinational corporations to move funds between their different subsidiaries in different countries.

A _____ Is a Loan Between a Parent and Its