Espenilla gets B+ grade in Global Finance card
Bridge financing — Financing obtained by a company expecting to secure permanent financing (e.g., through an initial public offering) within a short time, such as two years.
Capitalization — The company’s debt and equity structure.
Comfort letter — A letter provide by a company's independent auditors, detailing procedures to perform at the request of the underwriters. The letter supplements the underwriter's due diligence review.
Due diligence — The responsibility of those preparing and signing the registration statement to conduct an investigation in order to provide a reasonable basis for their belief that statements made in the registration statement are true and do not omit any material facts. Proper due diligence can help protect these parties from liability in the event they are sued for a faulty offering. The company, on the other hand, has strict liability for errors or omissions in the registration statement.
Firm-commitment underwriting — A type of underwriting agreement in which the underwriters agree to purchase all the shares in the offering and resell them to the public. Any share not sold to the public are paid for and held by the underwriters for their own account.
Bangko Sentral ng Pilipinas (BSP) Governor Nestor A. Espenilla Jr. has won a grade B+ in the 2018 central bank report card issued by the New York-based Global Finance publication.
Espenilla assumed the BSP’s highest-ranking position in July last year. When the 2017 central bank report card was released, he had a tag “too early to say” and did not rate a score since he was considered a “rookie.”
Global Finance grades central bank chiefs on “how well they do their jobs.”
The publication noted the BSP’s monetary policy actions of past months which was “designed to safeguard macroeconomic stability in an environment of rising commodity prices and ongoing normalization of monetary
Investment bankers — Specialists who advise companies on available sources of financing and the optimal time for a public offering of securities, and who often also act as underwriters for a public offering.
Lead underwriters — The underwriter who manages a securities offering and who acts on behalf of the underwriting syndicate. Traditionally listed on the left on the cost of a prospectus. Also known as managing underwriter.
Lock-up period — A period of time, usually 180 days, for which insiders are restricted from selling their shares.
Management's discussion and analysis (MD&A) — Section of an IPO prospectus that provides investors with management's assessment of historical financial information about expectations for the future.
Price-earnings ratio — The price of a share of common stock divided by earning per share.
Tranche — A French word used to describe segments of the IPO being sold in different countries. A multi-tranche distribution is commonly used for large US and foreign IPOs for which there is demand both in the United States and in the foreign country.
Atty. Billy Cortez is an independent board director at First Metro (Metrobank Group). He was formerly FINEX president and chairman of the Capital Markets Development Council.
abelardo.cortez7@gmail. com policy in advanced economies.” Since May, the BSP has raised key rate four times in a row to a cumulative 150 basis points to curb high inflation and potentially ease pressures on the exchange rate market.
Global Finance also noted that while the Philippine GDP grew 6.8 percent in the first quarter this year, and employment and wages are increasing, it said the local currency has depreciated to a 12-year low at the time of review, as “government spending on infrastructure drew in imports, widening the current account deficit.”
It added that "many emerging-market central banks (such as the Philippines) have been forced to raise interest rates this year to prop up their currencies in the face of a stronger dollar. Others have intervened heavily in the foreign exchange market, drawing down currency reserves.”