Medium Term Note
A company under its MTN program might post a schedule of debt securities with a range of maturities and rates. Investors could pick securities from the list and negotiate terms with the issuer directly or through an agent. In contrast to MTNs, corporate bonds tend to be issued in larger amounts and at the same rate and maturity to all investors.
Bearer bonds which can be issued in rotation in the context of a programme unrestricted by time (constant issue). The notes have a term of 2 to 10 years and are introduced in small tranches (Minimum ca. 40,000 Euro) by banks which are appointed as dealers, in the wake of a private placement with institutional investors.
A medium-term certificate of indebtedness, issued by a bank on demand, with maturities ranging between 2 to 8 years.
A note that usually matures in five to 10 years.
2. A corporate note continuously offered by a company to investors through a dealer. Investors can choose from differing maturities, ranging from nine months to 30 years.
Notes range in maturity from one to 10 years. By knowing that a note is medium term, investors have an idea of what its maturity will be when they compare its price to that of other fixed-income securities. All else being equal, the coupon rate on medium-term notes will be higher than those achieved on short-term notes.
2. This type of debt program is used by a company so it can have constant cash flows coming in from its debt issuance; it allows a company to tailor its debt issuance to meet its financing needs. Medium-term notes allow a company to register with the SEC only once, instead of every time for differing maturities.
Bearer bonds which can be issued in rotation in the context of a programme unrestricted by time (constant issue). The notes have a term of 2 to 10 years and are introduced in small tranches (Minimum ca. 40,000 Euro) by banks which are appointed as dealers, in the wake of a private placement with institutional investors.
A medium-term certificate of indebtedness, issued by a bank on demand, with maturities ranging between 2 to 8 years.
A note that usually matures in five to 10 years.
2. A corporate note continuously offered by a company to investors through a dealer. Investors can choose from differing maturities, ranging from nine months to 30 years.
Notes range in maturity from one to 10 years. By knowing that a note is medium term, investors have an idea of what its maturity will be when they compare its price to that of other fixed-income securities. All else being equal, the coupon rate on medium-term notes will be higher than those achieved on short-term notes.
2. This type of debt program is used by a company so it can have constant cash flows coming in from its debt issuance; it allows a company to tailor its debt issuance to meet its financing needs. Medium-term notes allow a company to register with the SEC only once, instead of every time for differing maturities.
posted by Pankaj Ratna at 4:01 AM
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