2. In Sept 2018, a Canadian bond investor was considering an investment in the following 7-year

bond:

Currency: Sterling Pounds (GBP)

Denomination: 150,000,000currency amount)

Maturity date: December 31, 2022

Interest payable: June 30 and December 31

Reference rate: LIBOR, 6 months arrears

Margin: LIBOR + 175 basis points

LIBOR historical rate table

Date ------------------------ 6-month LIBOR %

Jun 30,2015 ------------------- 0.4397

Dec 31,2015--------------------0.7693

Jun 30,2016---------------------0.9360

Dec 31,2016---------------------1.3073

Jun 30, 2017---------------------1.4323

Dec 31,2017---------------------1.7743

Jun 30,2018--------------------- 2.4959

Questions:

a. When and what amount of coupon payments has the issuer made on this bond to date?

b. Can the amount of the next coupon payment be determined? If so, how much will it be?

c. To what risk would an investment in this bond expose the Canadian bond investor?