Vocabulary

Corporate securities market рынок корпоративных ценных бумаг

Sluggish вялый

Cautious осторожный

To sink money вкладывать деньги

To possess обладать, владеть

Listing procedure процедура допуска ценной бумаги к торговле на бирже

Primary offering первичное предложение

Primary distribution первичное распределение

Prospectus (зд.) проспект эмиссии

To complete заполнять

Relevant относящийся к делу, уместный

Exercise 12. Answer the following questions:

1. What is characteristic of the corporate securities market in Russia?

2. Is the stock market of great importance to industry?

3. What is being done to contribute to the development of the Russian Stock Market?

4. What listing procedure is adopted by the Russian Stock Exchange?

5. Are the results of the stock exchange examination and relevant materials about the companies listed at the exchange made public?

Exercise 13. Find the Russian equivalents for the following:

1. actively traded stocks

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2. share prices of the corporations

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3. to encourage the process

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4. securities market development

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5. to create international electronic networks

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6. to possess the required capital

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7. to act as dealers in the primary market

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8. to meet certain standards

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9. to comply with the requirements

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10. to submit a prospectus of issuance

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11. to complete the questionnaire

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12. the information is broadcast by the Interfax channels

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Exercise 14. Find the synonyms for the words in italics.

1. What’s your opinion of the present-day position of the corporate securities market in Russia?

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2. Share prices of many corporations are going down.

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3. The market, due to the situation in Russia, is not attractive to investors.

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4. There’s no simple answer to this question.

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5. Attempts are being made to create international electronic networks for long-distance trading in shares.

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6. They possess the required capital, developed infrastructure and highly qualified personnel.

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7. a firm must meet certain standards.

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8. the company must submit a prospectus of issuance.

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9. This document must contain full information about the securities the company is going to issue

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10. The company is also required to complete the Russian stock exchange questionnaire to show its financial position.

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Exercise 15. Translate the sentences into English.

1. Рынок все еще малоактивный и вялый.

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2. В сравнении с западными рынками количество продаваемых акций невелико, ликвидность ограничена.

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3. Цены на акции многих корпораций падают.

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4. Иностранные инвесторы проявляют осторожность, опасаются вкладывать большие деньги в Россию.

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5. Ситуация затруднительная, поскольку известно, что фондовый рынок стимулирует экономическое развитие.

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6. Очень часто они играют роль дилеров в первичных рынках.

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7. Для первичного предложения или первичного распределения компания должна представить проспект эмиссии.

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Exercise 16. Read the article below quickly to pick out the main economic indicators. Then study the vocabulary given after it.

Borrowers Pile Up the Yankees

During the past six years, according to the Federal Reserve, foreign non-financial borrowers placed $170 billion of public and private bonds in the US – nearly four times the volume issued during all of the 1980s and taking the total amount outstanding to $264 billion last September.

Until recently, only most creditworthy foreign names were able to tap the US bond market, the largest pool of capital in the world. Yankee offerings were mainly limited to Canadian provinces, supranationals such as the World Bank and triple-A-rated governments and corporations. But as long-term US rates have fallen, and some barriers to entry were removed, many more borrowers have entered the market. By some estimates, single-A and lesser credits accounted for 60% of last year’s issues (of which 80% were for 10 years or longer).

The introduction of Rule 144a in April 1990 really opened the door, allowing issuers to offer bonds to large US institutional investors without registering the offering with the Securities and Exchange Commission (SEC). This exemption greatly reduces the underwriting and secondary-market trading to these placements.

The adoption of Rule 144a also helped increase awareness among foreign issuers of the US bond market’s unique attractions. “Many can tap 20-, 30- and even 100-year maturities at costs not achievable anywhere else in the world”.

On the demand side, US investors are becoming increasingly receptive to foreign names. In a recent survey of the 400 most active US institutional investors, JP Morgan found that foreign bonds now account for between 9 % and 10% of the average portfolio, compared with 4% to 5% just three years ago. One reason for this interest is a relative decline in the volume of domestic bond issues, especially by US industrials. In these circumstances investors are looking for new ways to diversify their credit exposure and they have looked overseas.

But the most powerful force behind increased demand has been an attempt by US fund managers to boost returns in hopes of outperforming the benchmark indices.

Why Yankees? Since they don’t come to the market often, their yield spreads may not be priced efficiently; it is not uncommon to see a 50 bp difference in spreads between apparently similar issues. Sophisticated managers are looking for “inefficiencies which the market will eventually recognize”, resulting in higher bond prices.

Not surprisingly, these investors are focusing on Asia, expect more Yankee issues from Indonesia, India, Thailand and the Middle East.