Bond Issue Underwriting

For firms that wish to issue bonds in capital markets we provide advisory and brokerage services that support our customers in their efforts to optimally satisfy their financing needs by managing the process within the framework of the twin principles of (1) optimal timing and (2) right target investor group.

How your firm can benefit from a bond issue:

  • It secures a substantial amount of medium term funding in a single go.
  • Not being subject to credit limits, it provides greater flexibility than loans from a bank.
  • Allows to restructure the company’s financial structure by its converting short-term bank loans into long-term debt.
  • Provides working capital to support growth without the need to put up collateral.
  • By accessing capital markets, a bond issue enhances corporate credit-worthiness.
  • Is relatively less expensive than an equity issue is.
  • Increases corporate prestige and recognition among investors, financial institutions, and business partners.
  • Provides additional cost advantages with subsequent issues

The Bond Issue Process:

  • Bonds have maturities of at least one year. Company-issued securities with maturities of less than a full year that are sold at a discount basis are referred to as "commercial paper".
  • The current price of a discounted bond is calculated by reducing the face value by the discount rate. These bonds do not have coupons. Coupon-bearing bonds may also be designed on a fixed or variable interest-rate basis depending on a firm’s needs and market conditions.
  • The interest rate payable on a fixed-rate coupon-bearing bond is set at the time the bond is issued and does not change over the lifetime of the instrument. In the case of variable-rate bonds, the amount of interest paid when a coupon is redeemed depends on movements in market interest rates, usually based on an "on the run" government bond
  • Bond issues may take the form of either a public offering or of a private placement that is reserved to qualified investors. The type of issue is decided upon according to the issuing firm's standing and needs as well as to market conditions.
Preliminary Analysis
  • SWOT Analysis
  • Identify an issue strategy.
Project Plan
  • Draw up a bond issue timeline.
Coordination With Consultancies.
  • Select consultant firms such as an external auditor and legal adviser.
  • Coordinate operations with consultancies.
Regulatory Applications
  • Manage application and reporting processes with regulatory agencies such as the Capital Markets Board, Borsa İstanbul, Takasbank, and the Central Registry Agency.
  • Determine bond issue costs and returns.
Marketing & Sales
  • Carry out the bond issue

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