Chapter 8 – International Banking
Q1. What are the benefits of issuing Eurobonds? Investing in Eurobonds?
A. An issuer can minimize the regulatory impact of issuance and minimize
Q2. Why are most corporate Eurobond issuers large, multinational corporations?
A. Eurobond markets are not o#cially regulated as a whole (other than local
regulations of the country of issuance). Investing in established, large
Q3. How has recent legislation accelerated the development of the Japanese M&A
market?
A. Japanese legislators have passed laws permi*ng foreign companies to use their
Q4. How has the Chinese government’s relaxation of its foreign exchange controls helped
facilitate growth in the Chinese economy?
A. Current account renminbi (RMB) became convertible into other currencies.
Additionally, the creation of the Qualified Financial Institutional Investor (QFII)
Q5. In a comparable transactions analysis, what additional considerations might an
investment banker factor in when valuing an emerging market company?
A. Unique country characteristics/risks; significant events in the country that would
Q6. Suppose you are a wealth advisor and a client has asked for your recommendation
on which of the BRIC countries poses the least risk and most opportunity for
investment growth. Brie9y compare the perceived risks and benefits of each of the
countries and provide support for your selection.
A. Open-ended question. Students should look at issues such as corporate
governance standards, history of government intervention in capital markets,