Thus, more willing to underwrite the deal. Local banks support the project on the level of banking market. In addition, the project would receive more approval from the government side. However, more banks involved may lead to higher administration costs and coordination issues. In addition, Chase would hold less controlling power with more banks included in the deal (in strategy #4, arrangers were 12 which are quite high otherwise strategy #5 without any arrangers) Syndication enables Chase and other lead arranger meet the demand for the loan amount without having to bear the market and credit risk alone.
So, it was able to generate money at cheaper price than its competitors in UK giving it a competitive edge as Northern Rock could place a lower price on its mortgages and thus, greatly expanded in the mortgage market. However, the bad side of this scenario was when the markets were no liquid anymore and the bank faced problem in generating funds. The assets started falling because initial investors failed to refund investments and the situation of bank run arose which caused the failure of Northern Rock (Huijbregts, 2007). This crisis was a small pivot on which political and economy fortunes turned. Bank run is a situation when depositors start withdrawal of money on large amounts because of the fear that the bank will fail.
Gold also has storing intrinsic value, and preserving wealth besides generating high level of return. Gold offers great benefits to an investor, whether in the physical market or as a part of investment instruments in the portfolio diversification. The value of paper money may fall and rise but the value of gold remains stable. It fulfills the function of money and is accepted as a form of payment internationally. [ Hafizi A.M., 'Gold
Revolvers : these are opposite of transactors, customers who carry balances, paying off those balances over time, thus "revolving" them and hence paying interest charges 3. Subprime : customers with no or poor credit history. Banks usually charge higher fees and interest rates to offset the risks associated Nowadays with a lot of banking activities being conducted on digital and mobile platforms banks have a lot more customer insights and can tailor their product offerings. Banks are also turning to a new customer segmentation methodology which is : 1. Prosperous and content : This is the premium segment who use credit cards for majority of their purchases.
(ii) Discuss why a dollar tomorrow cannot be worth less than a dollar the day after tomorrow. Answer: Money can be invested to gain return or interest over a period of time as it has a time value. But money in future can’t be invested immediately to earn interest and so must be worth less. For example, if an amount of $10,000 deposit to a saving account at an annual interest rate of 5% and compounded monthly, the amount can get after 10 years will be $16,470.09. But you can’t get $10,000 future dollar by today for investment.
Evidently, the potential financial loss to the family of the policy holders is sizable. 9.3.2. Encourage saving habits: Life insurance encourages saving habits. Long term savings can be made in a painless manner because of the easy installment facility built into the scheme. The insured person can pay premiums through monthly, quarterly, half yearly or yearly installments.
Many companies use two or more methods for depreciation and it also acceptable. For example, companies calculate its noncurrent assets by using the straight line method on its financial statements, while using an accelerated method on its income tax return. However, the method that most popular for companies is straight line method. Straight line method is most widely used due to it is simple to calculate and easy to understand. When apply this method, a company charges same amount of the value of asset for each accounting period.
This issue has a call option to buy back the debt in the fifth year, apart from a similar option before every interest payment. Moody’s rated this bond at BAA2, equal to company’s existing foreign currency debt. In Feb 2014, they raised another $750 through 30 year bond issue through international investors. The yield was 4.875%.This was used for the company’s expansion spree. In mid 2014, they raised another $350 million from overseas market mainly to refinance debt raised by Standard Chartered.
Record keeping saves time and show previous performance of the quality of goods and services also learning of level of staff. Keeping accurate records will benefit the business Having an accurate record keeping system which organisation keep up to date will help organisation pay the right amount of tax, avoid paying any extra or penalties. Record keeping financially can help organisation keep track of their expenses, see quickly what they are owed by others and how much they owe them. Record keeping shows whether an organisation whether, they are in need of money to ask for a bank loan or credit. Record keeping saves time and accountancy costs and receives the right amount of benefits or credits.