Sentences with phrase «junior debt»
I spent a little time this evening reviewing the prices of junior debt securities of marginally investment grade banks (and a few mutual insurers, also).
alephblog.com
Who paid attention to the increases in debts, especially junior debts like home equity lending during the boom?
8) After many other crises, junior debt gets grabbed when seniors have rallied a great deal.
I would add that investors in junior debt issues, including Islamic pseudo-debt issues have to be cognizant of the lack of guarantees involved.
7) Speaking of junior debt securities, Moody's gave the GSEs, and the US Government a shot across the bow when it downgraded the preferred stock ratings of Fannie and Freddie.
One advantage of this particular type is that, upon liquidation, a trust preferred's debentures generally rank as junior debt, ahead of a company's traditional preferred or common shares.
With highly levered, or very junior debt, it does not trade on a spread basis, but on a price basis.
Stock prices would improve as well, and that's fine during the boom cycle, for then, but many would issue expensive hybrid junior debt with an accelerated stock repurchase.
There was a chance if the credit markets rallied that the bonds might be worth something, but the odds were remote — it would mean no more defaults, and in late 2008 with a lot of junior debt financial exposure, that wasn't likely.
Recently I did some consulting for a financial institution that held the single - A tranches of several trust preferred CDOs that had CMBS, REIT debt, and a lot of junior debt from bank, mortgage, and housing related names.
Other mezzanine financing options include junior debt that is secured by a partnership interest, and a preferred equity structure in which the lender makes a capital contribution to the borrower in exchange for an equity share in the property.
Typically, the B - piece is the bottom or most junior debt in a conduit deal.
His primary responsibilities include sourcing and structuring senior and junior debt opportunities for residential and commercial projects throughout BC.
This reinfirces why I rarely recommend preferred stocks, or junior debt securities: the payoff is low in success, and losses are high when things go wrong.
Anytime one buys a mezzanine or subordinated security, or buys a surplus note, or trust - preferred security, or other bit of junior debt or preferred stock, one must ask, «Can I afford to lose it all?»
Barring investment in more funky fixed income instruments such as preferred stock, trust preferreds, junior debts, CDOs, ABS, RMBS, CMBS, etc..
The preferred stocks reflect a part of the credit market that hasn't gotten whacked too bad, offering a decent yield for the junior debt on healthy companies risk.
Beyond that, there was a dearth of true equity, and a surfeit of preferred stock, junior debt, trust preferreds, and particularly, goodwill.
The junior debt is subject to subordination in the event of default or bankruptcy.
In the case of default, creditors with unsubordinated debt would get paid out in full before the junior debt holders.
If all of the assets were sold, would there be enough for the junior debt or preferred shareholders to get paid?
Junior debt, trust preferreds, hybrids, preferred stock, etc... These are all relevant bits of data to tell whether the common stock will indeed zero out.
A close competitor was when I began buying the junior debts of banks in late 2002, particularly of the floating rate variety, which offered more upside.
Junior debt — not as safe as senior debt, but because they were floating rate, they did not have the same call provisions as the fixed rate securities.
I was pleasantly surprised that all of them had steered clear of the current lending crises, and the level of exposure to financials, and their junior debt was low.
PS — In distress, the real pros look down the capital structure to see whether the preferred stock, junior debt, senior debt, bank loans, or trade claims look attractive.
Negatively, all junior debt tends to return worse on average than senior debts.
Even raising the dividend increases leverage, because it is like junior debt, corporations know their stock prices will fall if it isn't paid or increased.
The need for yield is significant, much as I think it is premature to buy those junior debts.
and all junior debt gets reattached when homeowner redeems thats why they are so rare.