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InvestHub.com's
Finance Dictionary and Glossary of Investment Terms

Nonproductive loan  

Definition 1.

loan that increases spending power, but is used in business that does not directly increase the economy's output, such as a leveraged buyout loan.
 

Definition 2.

A commercial bank loan which does not directly increase the economy's output, even though it may increase the total spending power of the economy. An example is a loan whose purpose is to finance a leveraged buyout.
 
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