Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Issuer's Considerations
Cash Flows: Issuers may consider the period for which the funds are required and try to spread the borrowings in a way to minimize the costs. Generally, the requirements of funds will depend on the purpose for which the funds are raised.
Taxation: Issuers may have to assess the tax liability of the company and try to design the instrument in order to get the benefit of certain tax incentives for the company and to the investors. The attempt would be to minimize the tax liability of the issuer.
Leverage: Issuers may assess the debt to equity ratio of the company since excess of debt may burden the company with debt servicing. Further, in a falling interest rate scenario a debt contracted for a long-term will increase the cost of funds for the company.
Dilution of Control: Likewise, excess of equity will dilute the control over the company and this will be a disincentive especially if the promoters prefer the company to be closely held.
Transaction Costs: The instrument should have adequate liquidity so that investors costs while transacting are minimal.
Quantum of Funds: Issuers may target the investors based on the quantum of funds required and the time within which the funds are to be raised.
Maturity Plan: Depending upon the future requirement of funds and also on the availability of funds to repay the lenders, the repayment schedule of the instrument has to be designed.
A company borrows $1,500,000 at LIBOR plus a lending margin of 1.25 percent per year on a six-month rollover basis from a London bank. If six-month LIBOR is 4 ½ % over the first s
Q. Show the Signs of Overtrading? There are a number of usually recognised signs that a company may be overtrading. These are considered mutually with relevant financial data f
Why do we need to learn finance The questions that you may thinking about right now are "Why do we need to learnfinance? Shall we not leave it to people who are going to speci
Treasury bonds are the bonds issued with maturities greater than 10 years. However, these are commonly issued with a maturity of 30 years. Like T-notes, these bon
Q. What do you mean by Equity? Equity - Residual INTEREST in ASSETS of an entity which remains after deducting its LIABILITIES. Additionally, amount of a business' total assets
When a borrower uses repo market for fund financing, he has to deliver the securities to the lender. One way to do this is to deliver the collateral to the lender
Q. Describe about Permanent Working Capital? Permanent Working Capital: - The requirement for working capital fluctuates from time to time. Nevertheless to carry on day-to-day
Q. Aggressive Approach of financial management? A -firm may be aggressive in financing its assets. An aggressive policy is said to be followed by the firm when it uses short-te
Q. Explain about Current Value? Current Value - (1) Value of an ASSET at present time as compared with asset's HISTORICAL COST. (2) In finance, amount determined by discounting
Consolidations of Merger - amalgamation A consolidation is a combination of two or more companies into a new company. In this form of merger all the existing companies which co
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd