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It is required to have authorizations from the National Council of Economic and Social Policy (CONPES), and the Inter-Parliamentary Committee of Public Credit. In addition, it is required that the Central Bank set certain financial parameters to which any issuance, such as term and rate, should be adjusted.
No. Although the conditions under which the Global TES are issued, are determined by the Ministry of Finance and Public Credit, according to the provisions of the different jurisdictions where these securities are circulated, it is not responsible for indicating the form in which they should be valued. Superintendencia Financiera de Colombia is the entity that provide the guidelines to value the Global TES.
For the Global TES due in 2010 and 2015, the exchange rate at which the coupon is paid is defined as 3 business days before the coupon payment and will be the average of the TRM for the last 20 business days. In the case of the TES Global with maturity in 2027, the rate is defined as 3 days before but with the average of the TRM of the last 5 business days.
The payment of the coupon is made directly to the bondholder, 15 days before the date of payment. This must be taken into account to make a transaction with these securities, within 15 days to the date of payment.
No. The currency in which the bond was issued does not define its appeal. Yankee bonds received this appeal to comply with US market legislation, but not necessarily, because they were denominated in American dollars. Currently, Colombia does not have outstanding Yankee bonds. Existing US dollar bonds are Global bonds, which meet the requirements to trade both in the US market as in the European.
Brady bonds are mostly debt securities that were issued by several emerging countries, mostly Latin American, under the debt restructuring program promoted by Secretary of the Treasury Nicholas Brady, after the debt payment default incurred in the 1980s. As Colombia did not default on its foreign debt at the time, it was not necessary to issue these bonds.
It is an index prepared by the JP Morgan bank that reflects the yield differential between US Treasury bonds and a portfolio of emerging market bonds. This index is divided into sub-indices for each country or region, reflecting the spread vis-à-vis the US Treasury yields and the bonds of a country or sub-set of emerging countries. Similarly, there are variations of the index according to the characteristics of the bonds included in the calculation, such as EMBI Global or EMBI +.
The difference depends on the selection criteria of the countries and the bonds that are included in the calculation. The countries included in EMBI Global are those qualified by the World Bank as low / medium income for two consecutive years; While a rating equal to, or lower than Moody's Baa1 or S&P BBB + is required to be included in the EMBI +. Regarding bond specifications, both indices require bonds of more than US $ 500 million outstanding, with initial maturities of 2.5 years and at least one year of maturity in force. However, the difference is that for the EMBI + the bonds must have a defined number of quotes and comply with a specific bid/ask spread. On contrary, for EMBI Global, a price source from a broker or JP Morgan can be enough.
No. The index is prepared by the bank JP Morgan, which is a paid service. The Ministry of Finance or IRC are not in a position to publish historical series of this index.
It is a registration procedure with the US Securities and Exchange Commission. Which requires an issuer to meet the registration requirements two years before making a public offering of securities in that market. Through this registration, the entity can access the market by delivering periodic reports to the SEC.
It is the medium-term note issuance program denominated in euros. It is a medium-term debt instrument, which requires fixed payments and it is issued directly to the market, with a maturity of less than 5 years. With it, the issuer establishes the basic terms for the issuance of securities at the beginning of the program, with respect to the total amount of the program, currency and possibly the maturity range. This program allows you to access the market quickly and is more efficient for frequent emissions.