Chapter 632 Bond Underwriting

New York, Wall Street.

As a member of Wells Fargo, every day life is full and busy.

Getting up in the morning to catch the subway to go to work, and then leaving after nightfall is the most common normality in work.

Don't say that foreigners don't work overtime, those are just losers, with a meager salary every day, living his life from nine to five, doing nothing, year after year.

The real elites have never worked overtime. For them, work is a part of life.

People only see them flying planes, sailing yachts, and living in luxury houses when they are on vacation, but they never think about what they paid for it.

Just like Fuguo has a new business recently, all employees' vacations have been cancelled, but no one will complain.

Wall Street has had a crazy overtime culture since its prosperity, and normal working hours every day cannot be exchanged for high-paying jobs and a lot of money.

Newcomers who have just entered the industry basically have to maintain a daily workload of more than 15 hours in order to prevent themselves from being eliminated by this job or by colleagues who work harder.

Besides, there are legions of elites out there who lost their jobs in the Great Depression, waving their resumes and trying to get back a job on Wall Street.

No overtime? Get out.

"Ma'am, this is the plan for the issuance of FCA's new bonds." The secretary put the new plan on Julie's desk.

"What's the current debt ratio of FCA?" Julie said without raising her head.

Julie is very optimistic about Chrysler's plan to issue bonds again, seek to expand production, and occupy market share.

As one of the three giants in the American auto industry, Chrysler never had to worry about sales when it issued new shares and bonds.

It’s just that today is different from the past. It’s no longer the roaring 20s. People will blindly follow the trend of the financial market, and it won’t happen again in the short term.

Chrysler's issuance of new debt this time puts forward the requirement of underwriting to Rich Country, which increases the risk and pressure of Rich Country.

It is normal for Chrysler to have this concern. Their recent financial statements are very ugly, and they have lost money for five consecutive quarters. How can they keep investors confident.

Now is not the Internet age, everyone is comparing debts and looking to the future.

In this era, five consecutive quarters of losses can make a large company abandoned by all investors.

This is also for Chrysler. If it is other companies, it may have gone bankrupt, so what about bond underwriting.

Responsible for underwriting, although it seems that it has nothing to do with Fuguo, in fact, in people's eyes, Fuguo has changed from an independent third party to a representative of the issuer in disguise.

If the bonds recommended by them cause investment losses to creditors, the reputation of the rich countries will also suffer from it.

Underwriting also has its benefits, and they can get 2 points in terms of fees.

The higher the total value of the bonds issued, the lower the expense ratio.

Like large enterprises, government bonds, and city bonds, there are generally large-scale bidding meetings, and whoever has the lowest price will be handed over to the underwriter.

The advantage of this is that there are more choices, and you can get actual benefits and less expenses. The disadvantage is that the cycle is prolonged and unstable.

"The current debt ratio of FCA is 57%, and the evaluation given by the risk control department is B." The secretary said respectfully.

B. There are a small number of risk factors, and the overall high-quality assets, except for market factors or customer subjective information deception, have a security higher than 65%.

70 percent, in terms of the financial market, is only one level worse than 100 percent.

"Let everyone move and complete the required materials and reports as soon as possible. This is the first battle...we have to fight beautifully." Julie attaches great importance to this release.

Whether Fuguo can be recognized and gain a firm foothold in the investment field depends on whether they can successfully complete FCA's bond underwriting business this time.

In Julie's view, the best result is to sell all the bonds during the issuance period, and it is the best not to let the rich countries take any risks.

But if not,

Wells Fargo can only buy the remaining unsold bonds at the end of the issuance period, and then find a suitable opportunity to sell them to new buyers or hold them for themselves.

At the same time, Julie also wants to keep Chrysler satisfied, and Manhattan Chase is right to hand over customers to them.

But whether it can be maintained and how long it can be maintained, it all depends on the ability of the rich country.

Don't think you just have to do a good job!

In order to satisfy the patron's father, Fuguo sent six people to accompany the shareholder's daughter and sons to walk, shop, and buy.

Chrysler will issue 200 million US dollar bonds this time, with a term of 2 years, and the method of interest payment will be a one-time payment when it matures, and the repayment method will also be a one-time settlement.

Fuguo's handling fee is 24 million, which is a very objective profit.

But in fact, the benefits they get are far more than that. You must know that the issuance will take a certain amount of time, and the paid funds will be frozen before the amount reaches the predetermined total.

These funds are frozen in "Manhattan Chase," and the bond issuance cycle is generally 12-14 weeks, about three and a half months.

That is to say, during this period, "Manhattan Chase" will have an extra fund of 200 million dollars.

Maybe there are only tens of millions in the early stage, or the release period is about to end, but that's all.

But even if it is tens of millions, it can create a lot of benefits for Chase within three months.

Of course, this money also has to pay interest.

The cost of issuing corporate bonds is paid by the interest generated by freezing funds during the issuance period.

Under Roosevelt's ban on gold exports, the issuance of national bonds to provide loans to enterprises, and a series of measures such as currency depreciation to enhance export competitiveness, the economy is growing rapidly.

The Federal Reserve's interest rate has been lowered back to 2 percent from the previous 3.6 percent.

As a savings bank that is still in the direction of dividing its operations and grabbing the market, Manhattan Chase sets an annual interest rate of 2.8%.

If the issuance fee of a financial bond is less than the interest income generated by freezing funds during the issuance period, the difference shall be deemed as the premium income from the issuance of the bond.

If the interest generated from the frozen funds during the issuance period is not enough to pay the issuance expenses, if the difference is small, it will be directly included in the current profit and loss.

That is to say, if there is a lot of interest, even if it is the issuance premium income, if the company needs to pay less, it will be directly included in the company's payment, and the profit and loss will be calculated at the end of the year.

4 million for 200 million, whether the interest is enough is a good deal for the enterprise.

In short, bonds are a very troublesome thing, and its complexity far exceeds that of the stock market, let alone the so-called "combined bonds." '

Combined financial products can be so complicated that even people in the industry can't understand, 'what the hell is this thing? '

This is just the issuance. If you want to play well in the bond market, you must not only have a good brain, but also have a sufficiently good, large and professional team.

Otherwise, even if you are a fairy, you will have to sell your pants at a loss in the bond market.