2. Citibank offers to syndicate a Eurodollar credit for the government of Poland with the following terms:
Question:
2. Citibank offers to syndicate a Eurodollar credit for the government of Poland with the following terms:
Principal US$1 billion Maturity 7 years Interest rate LIBOR + 1.5%, reset every six months Syndication fee 1.75%
(a) What are the net proceeds to Poland from this syndicated loan?
(b) Assuming that six-month LIBOR is currently at 6.35%, what is the effective annual interest cost to Poland for the first six months of this loan?
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Related Book For
International Financial Management
ISBN: 9781118929322
10th Edition
Authors: Alan C. Shapiro, Peter Moles
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