Matching Questions: Choose from the following list of terms to complete the sentences below: paying agent, managing banks, trustee bank, placing agents, market, lead bank (or lead manager), participating banks, prospectus, gray market, fiscal agent, buy forward, underwrite, lead manager, red herring.
A consortium (or syndicate) that extends a euro loan consists of many banks that could play different functions. In a euro loan, the (a) Negotiates with the borrower for tentative terms and conditions, obtains a mandate, and looks for banks to provide the money or undertake to provide the money if there is any shortfall in funds. The banks that provide the actual funding are called (b). Because at the time of the negotiations the funding is not yet arranged, the (c) often contacts a smaller number of (d) banks who (e) the loan, that is, guarantee to make up for the shortage of funds if there is any such shortfall. The (f), finally, is the bank that receives the service payments from the borrower and distributes them to the participating banks.
Placement of euro bonds is most often via a syndicate of banks or security houses. The lead bank or (g) negotiates with the borrower, brings the syndicate together, makes a (h) (at least initially), and supports the price during and immediately after the selling period. There are often, but not always, (i) that underwrite the issue and often buy part of the bonds for their own account. The (j) call their clients (institutional investors or individuals) and sell the bonds on a commission basis. The (k) takes care of withholding taxes, while the (l) monitors the bond contract. Prospective customers can find information about the issuing company and about the terms and conditions of the bond in the (m). Often an unofficial version of the prospectus is already circulating before the actual prospectus is officially approved; this preliminary prospectus is called the (n). On the basis of this document, investors can already (o) the bonds for a few weeks before the actual issuing period starts. This period of unofficial trading is called the (p) period.