FINS1612 Chapter 9: Viney8e_IRM_ch09
Document Summary
It is placed in deficit when expenses are paid and brought back into credit when revenues are received. The credit status of the bill is enhanced if a bank puts its name on the bill as acceptor (and thus takes primary liability to repay the bill at maturity). 2 date: banks often discount bills for a customer and then sell the bills into the money markets. The dealer panel members will create an active secondary market in the p-note issue: the issuer may also use a syndicate of underwriters to assist with the distribution of the paper. They guarantee, subject to the terms of the underwriting agreement, to purchase any paper not taken up by dealer panel or institutional investors: the discount security formulae are used to make p-note calculations. 180 days: banks may use cds to manage their liability needs (short-term funding requirements) and their liquidity needs (managing day-to-day cash flows).
