Features of Euro Credit Market

abhishreshthaa

New member
Characteristics of Euro credit


A major part (more than 80 %) of the Euro debts is made in US dollars.


The second (but far behind) is Pound Sterling followed by Deutsch mark, Japanese yen, Swiss franc and others.



Most of the syndicated debts are of the order of $50 million. As far as the upper limits are concerned, amounts involved are of as high magnitude as $5 billion and more. In 1990, Euro tunnel borrowed $6.8 billion.



On an average, maturity periods are of about five years (in some cases it is about 20 years). The reimbursement of the loan may take place in one go (bullet) or in several installments.



The interest rate on Euro debt is calculated with respect to a rate of reference, increased by a margin (or spread).


The rates are available and generally renewable (roll over credit) every six months, fixed with reference to LIBOR.


The LIBOR is the rate of money market applicable to short-term credits among the banks of London. The reference rate can equally be PIBOR at Paris and FIBOR at Frankfurt, etc. It is revised regularly.



The margin depends on the supply and demand of the capital as also on the degree of the risk of these credits and the rating of borrowers. Financial institutions are in vigorous competition.


There is an active secondary market of Euro debts. Numerous techniques allow banks to sell their titles in this market.
 
The most pertinent news about Euro is Greek Euro exist

Greek Prime Minister Alexis Tsipras has told the nation Sunday's planned referendum on a financial offer from creditors will go ahead as planned - but insisted a 'no' vote would not force the country to leave the Euro.

Tsipras also accused Europe's financial leaders of "blackmail", adding it was "shameful" that Greek banks were forced to close but reassuring savers their deposits would not be lost.
 

rosemarry2

MP Guru
Characteristics of Euro credit


A major part (more than 80 %) of the Euro debts is made in US dollars.


The second (but far behind) is Pound Sterling followed by Deutsch mark, Japanese yen, Swiss franc and others.



Most of the syndicated debts are of the order of $50 million. As far as the upper limits are concerned, amounts involved are of as high magnitude as $5 billion and more. In 1990, Euro tunnel borrowed $6.8 billion.



On an average, maturity periods are of about five years (in some cases it is about 20 years). The reimbursement of the loan may take place in one go (bullet) or in several installments.



The interest rate on Euro debt is calculated with respect to a rate of reference, increased by a margin (or spread).


The rates are available and generally renewable (roll over credit) every six months, fixed with reference to LIBOR.


The LIBOR is the rate of money market applicable to short-term credits among the banks of London. The reference rate can equally be PIBOR at Paris and FIBOR at Frankfurt, etc. It is revised regularly.



The margin depends on the supply and demand of the capital as also on the degree of the risk of these credits and the rating of borrowers. Financial institutions are in vigorous competition.


There is an active secondary market of Euro debts. Numerous techniques allow banks to sell their titles in this market.

Hello abhi,

Well, i found some Study on Euro Credit Market and wanna share it with you and other's. So please download and check it.
 

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