- •Vocabulary Commentary
- •All yours Manufacturing companies are increasingly using the Internet to give customers the impression of personal service. But true customisation needs new production techniques as well
- •Vocabulary
- •Can Bayer Cure Its Own Headache? Shareholders would like it to shed everything but health care
- •Vocabulary
- •«Байер» перестраивается
- •Nokia's next act Can the Finnish giant stay on top in an age of commodity phones and stalling sales?
- •Vocabulary
- •Canon Cutting Edge By trimming down to four product lines, it's making record profits
- •Halfway down a long road Carlos Ghosn's efforts to meld Nissan with Renault have become the stuff of management legend. But the alliance faces some daunting challenges
- •Can Ford Fix This Flat?
- •Vocabulary
- •Vocabulary
- •A Challenge From the Nimble Newcomers
- •Mergers & Acquisitions Will the latest cycle of European mergers produce better results?
- •Vocabulary
- •Vocabulary Commentary
- •Independent directors at big public companies need to be tougher
- •Vocabulary
- •Vocabulary
- •U r Sakd
- •Is there a nice way?
- •Simon London finds the post of chief operating officer falling prey to a new breed of executive with greater powers and access to the boss
- •The Bottom Line on Options
- •Unit 13 Consolidation
- •Will ceOs Find Their Inner Choirboy?
- •Пролетая над Таити
- •Vocabulary
- •Useful Words and Phrases
- •«Нортел»
- •The Numbers Game Companies use every trick to pump earnings and fool investors. The latest abuse: "Pro forma" reporting"
- •Vocabulary
- •Unit 15
- •I swear… Oaths are only a small step in the business of cleaning up American companies
- •Something must be done
- •Vocabulary
- •Holier Than Thou European sanctimony over American accounting scandals is misplaced
- •Et, the extra-territorial
- •Vocabulary
- •Revenge of the Bean Counters No longer frail in the face of fraud, accounting firms are thriving on new u.S. Laws that give them real clout
- •Half Measures
- •Bad for cfOs, Good for Investors
- •Хранители прозрачности или слуга двух господ
- •Unit 16
- •Up from the ashes Amid a global wave of business failures, American firms are more likely to get a second chance. Unfair competition, or a lesson for Europeans?
- •Eurotunnel vision
- •Vocabulary
- •Var crash
- •Vocabulary
- •Европа уходит за рубеж
- •Goldman's German revolution
- •Have Fat Cats Had Their Day?
- •Unit 18
- •Stronger foundations New proposals for regulating banks are both a step in the right direction and evidence of how hard it is to monitor the riskiness of the banking system
- •Vocabulary
- •Vocabulary
- •Английский характер
- •Unit 19
- •Conflicts, conflicts everywhere Was America wrong to scrap the laws that kept commercial and investment banking apart?
- •Vocabulary
- •Care To Buy Some David Bowie Bonds
- •In Europe, securitization is the hottest way to raise cash
- •Beautifying Branches
- •Instead of axing their branches, banks are inventing new ways to make money out of them
- •Slippery
- •Coffee, Tea, or Mortgage?
- •Life Branches?
- •The world's biggest retailer edges into financial services
- •Гросс-банки сокращаются
- •Feeding Frenzy
- •Tough Questions for aig's Auditors Regulators are probing if PwC let the financial shenanigans slip through
- •Watchdogs with Eyes Wide Shut As investigators pore over the books of aig, it's becoming clear that for years regulators failed to detect lapses
- •Goldman's German Revolution
- •Another Year, Another Scandal
- •Digging out at Allianz The German financial-services giant is back in the black — but still struggling
- •A Dedicated Enemy of Fashion Most companies claim to run their business for the long term. Nestle is one of the few that really does
- •More Pain, Waiting for the Gains Drastic action as gm's cash pile runs down
- •«Морган Стэнли» увольняет сотрудников, чтобы оставшиеся лучше работали
Vocabulary
safeguard n v |
гарантия; охрана; предосторожность/гарантировать; охранять |
to blow the whistle on smth |
положить конец чему-либо; сообщать о нарушениях (в компании); поднимать тревогу |
whistleblower, n |
лицо, сообщившее о нарушениях; активист компании |
conflict of interest |
конфликт интересов |
underwriting n |
1) андеррайтинг, гарантирование размещения (ценных бумаг); 2) страхование (морское) |
underwrite v to underwrite an issue |
гарантировать размещение выпуска ценных бумаг на рынке; |
underwriter n |
андеррайтер, гарант размещения (ценных бумаг), страховщик (морской) |
to mark to market |
переоценивать активы или позиции в соответствии с текущими рыночными ценами |
secured a Syn. covered |
обеспеченный |
unsecured а Svn. uncovered |
необеспеченный |
repeal v to repeal an act Syn. abolish, scrap |
отменять (закон) |
initial public offering (IPO) |
первоначальное публичное предложение акций; выпуск акций новой компании на рынок |
property-casualty insurer |
страховая компания, занимающаяся имущественным страхованием и страхованием от несчастного случая |
Exercise 1. Translate the following into Russian.
to deal with conflicts of interest; to address problems of unsecured loans; to repeal an accounting rule; lending standards; to be over-leveraged; to require the banks to mark their loan portfolios to market; to make a loan at a loss; to impose statutory barriers; to advise on mergers and acquisitions; a quasi-public statutory function; to encourage better oversight; accident insurance, liability coverage; third party insurance; health insurance; IPO
Exercise 2. Translate into English.
необеспеченная облигация; страхование гражданской ответственности (перед третьими лицами); отменить закон, разделяющего коммерческие и инвестиционные банки; создать в соответствии с законом препятствия для проведения сомнительных операций; улучшить надзор и регулирование; вводить налог на эмиссию акций новых компаний; предусматривать меры, гарантирующие соблюдение закона
• Text 2
Care To Buy Some David Bowie Bonds
In Europe, securitization is the hottest way to raise cash
Rock star David Bowie did it. Madame Tussaud's wax museum has done it, too, and so have hospitals, credit-card issuers, and the folks that bring you the World Cup. What is it? Securitization. That's a way of hedging financial bets — and raising fast money — by bundling assets and selling bonds backed by current and future revenue from those assets. Once a financial strategy pretty much confined to the New World, it has caught on big-time in the Old Europe in the past few years has become a hotbed of securitization, as companies from London to Rome look for innovative ways to tap the financial markets.
Indeed, securitization has never been more popular, as banks become increasingly skittish about lending money in today's volatile capital markets. On Feb. 12, British property developer Canary Wharf Group PLC issued $1.8 billion in bonds backed by rental income from the company's portfolio of office blocks — including four buildings still under construction — in London's Docklands. It's the fifth time in as many years that Canary Wharf has tapped the securitization market, raising a total of $5 billion. The proceeds have gone to fund development, repay construction loans, and even return cash to shareholders. "Securitization lets us more effectively manage our balance sheet," says Canary Wharfs managing director of finance, Peter Anderson. "There's also a substantial pricing advantage."
Canary Wharf is just one of hundreds of companies jumping into the game. Last year, the European securitization market grew 54%, with $117 billion in bonds issued. This year, new issuance is likely to exceed $155 billion, according to Deutsche Bank. Once the sole province of banks that bundled mortgages and credit-card debt, securitization has become a favorite financing tool for a broad range of companies, including telecoms, utilities, and retailers. Companies benefit because they can often raise money at better rates than those offered by banks or the unsecured bond market.
In Europe, worsening economic conditions and rising debt levels are fueling the market's growth. For companies — and even governments with assets generating predictable revenue, "securitization is a highly efficient way to lock in long-term financing," says Ravi Joseph, head of European securitization research at Morgan Stanley Dean Witter & Co. in London.
These days, anything is fair game for securitization. In the past three years, Telecom Italia has securitized future receipts from telephone bills, London's Madame Tussaud's has securitized future admissions, and the international football federation, FIFA, has sold bonds backed by sponsorship revenues from this year's World Cup. David Bowie's 1997 deal was a typical one: He securitized the future royalties to his music, netting himself a cool, quick $55 million — though it means he will lose the revenues from 300 of his songs.
Here's the way a securitization deal works: Rights to the assets are sold to a specially created company, which issues bonds backed by those assets. By separating the credit from the original owner — who can no longer use the assets for his own purposes — the new company earns a higher credit rating, allowing it to raise money more cheaply.
The surge in demand for securitized bonds is welcome news for investment banks in Europe, which have seen an income drought from initial public offerings and mergers. The banks are pouring resources into the area in hopes that securitization will open the floodgates to all sorts of other fee-generating deals, including leveraged buyouts, acquisitions, and advisory services. A decade ago, Morgan Stanley had four people doing securitization in London. Today, there are more than 50. Rivals Citigroup and Credit Suisse First Boston have seen the same growth. Others are quickly getting into the act. Goldman, Sachs & Co. recently poached Citigroup securitization honcho Bill Young to co-head its own structured finance team. The securitization market, he says, "has been stimulated by increased investor interest."
One prime target of the securitization push: European telecoms, which are so debt-ridden they are having trouble raising funds at reasonable rates by conventional means. Last year, British Telecom securitized rental cash flows from commercial properties it owns, raising $2.5 billion. France Telecom, Deutsche Telekom, and Telecom Italia all have securitization deals in the pipeline for later this year.
European Union governments are also expected to tap the market in the coming year. The Italian government did three big deals in 2001, securitizing future lottery revenues, government property rentals, and delinquent social security contributions, in the process raising a total of $6 billion, indeed, Dresdner Kleinwort Wasserstein predicts that Eastern European countries will use securitization to bring down their debt levels in order to qualify for entry into the EU.
That kind of creative financing, of course, ought to set off alarm bells. Analysts worry that the securitization craze could get out of hand. The rule of thumb within the industry is that no company or government agency should securitize more than 20% of its assets. But, says Ganesh Rajendra, director of European asset-backed research at Deutsche Bank in London, Europe has a long way to go before reaching that saturation point. Moreover, the independent rating agencies are watching the trend closely. "As with any financing innovation, companies need to be cautious that it doesn't weaken their balance sheet," says Cliff Griep, chief credit officer for Standard & Poor's in New York.
Until some watchdog agency reins them in, however, the securitizers will continue to flourish. At least for now, the only obstacle to the market's growth is the creativity and imagination of the investment bankers driving it.
Business Week
• Text3