Question
general answer the questions sometimesI could not capture the importance of the problem this is the link of the paper file:///Users/xuyihang/Library/Containers/com.tencent.xinWeChat/Data/Library/Application%20Support/com.tencent.xinWeChat/2.0b4.0.9/61d52bea64816f3f9c24407b8660e1b1/Message/MessageTemp/7fca34cd87f568726ae1eb7fb86c9491/File/Case%20Analysis%20Chase%20and%20HK%20Disney%20Loan%20Highlights.pdf question 1.Chase's International Strategy
general answer the questions sometimesI could not capture the importance of the problem this is the link of the paper
file:///Users/xuyihang/Library/Containers/com.tencent.xinWeChat/Data/Library/Application%20Support/com.tencent.xinWeChat/2.0b4.0.9/61d52bea64816f3f9c24407b8660e1b1/Message/MessageTemp/7fca34cd87f568726ae1eb7fb86c9491/File/Case%20Analysis%20Chase%20and%20HK%20Disney%20Loan%20Highlights.pdf
question
1.Chase's International Strategy - the bank was committed to its standing as a leader in major international transactions. What were the principal benefits for Chase in building and maintaining a very elaborate and expensive specialization - including over 400 people in the major capital centers of the world? The first quote at the beginning of the case is "We are investment bankers, not commercial bankers..."
Explain the basis of that comment and how it reflects Chase's business strategy.
2.Country Risk Analysis - banking involves permanent commitments to allocating capital to new areas of activity. "Country risk" represents the combination of unique factors which can affect credit and investment exposure - regional tensions, domestic politics, government regulation, corruption, economic cycles, crime and other factors. In the Disneyland project Chase had to consider a series of uncertainties - Hong Kong has been restored to China as a Special Administrative Region which can be expected to be increasingly governed by China; Hong Kong's economy appears to be in a long-term readjustment to the loss of its special status as entry point to China and Southeast Asia; China is changing dramatically politically and economically in ways which were unpredictable for the future. Viewing the country information provided in the case and the commitments involved in the Disneyland syndication how could Chase justify a long-term commitment to the project? What is your view on the political risks involved for Chase and for smaller banks with more discretion about their international commitments?
3.Corporate Risk Analysis - clearly Disney is an important company with a high credit rating. There is no doubt about Disney's creditworthiness. Based on its strong relationship with Disney, Chase made strenuous efforts to deal with the proposal. Examine Chase's processes. Do you think the bank compromised or reduced its standards for a deal of this kind because of the strong Disney relationship? Comment on the considerations within the Chase/Disney relationship which were motivations for the bank's actions.
The case focuses on principal considerations of international banking.
1.Chase's international strategy and objectives
2.Country Risk evaluation - Hong Kong and China.
3.Corporate risk - Disney Company.
4.Project risk - Hong Kong Disneyland.
5.Financing structure - HK$3.3 billion syndicated loan.
6.Loan Syndication management
Chase Strategy - Hong Kong
4.Project Analysis - the credit evaluation of the project is based on the ownership structure, the commitments of the two principals - Disney and the Hong Kong Government - and the financial structure of the project itself (Exhibit 5). Review the ownership structure and the important implications for a credit decision. Are there any potential difficulties with the structure or with the credit over the long run? Do the sources, availability and uses of funds appear to provide for a solid base for the project?
5.Financing Structure -Chase based its syndication loan structure on past transactions for major Hong Kong entities (Exhibit 7). Review those transactions. Which provide the best guide to the Disneyland project? Why? How do the other transactions provide guidance and what elements appear to have influenced the Chase Disneyland proposals?
6.Loan Syndication Management - Chase developed several alternative strategies for the syndication (Exhibit 8). Briefly review the strategies and comment on the essential differences. Leadership of the bank syndication was a major business triumph for Chase. Review the risks Chase undertook as the principal underwriter of the syndicate and the rewards it earned for its key position.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started