The indebted property developer revealed it has offered paying 175 basis points in interest over the London Interbank Offered Rate
Last week, Kuwait's Gulf Holding Company sold $190 million of five-year Islamic bonds, or sukuk, at 275 basis points more than the three-month London Interbank Offered Rate
The trust preferred securities will bear a floating interest rate equal to 90-day London Interbank Offered Rate
(LIBOR) plus 1.6 percent.
Interests on the notes are indexed to the London Interbank Offered Rate
, payable monthly (or quarterly) in arrears.
The interest rates of many ARMs aren't attuned to the prime interest rate but to bank deposits in specific regions of the country or to international indexes such as LIBOB (London InterBank Offered Rate
Rottenberg says the one-year loan, placed on behalf of a Virginia-based developer, was priced 225 basis points over the one-month London Interbank Offered Rate
. He says the developer took the interim financing approach because he "required time to complete negotiations for the buyout of an existing tenant before determining the project's final configuration."
The scheme relied on applying the installment sale (see "Installment Sales" on page 67) and contingency sale rules to sales of foreign currency for cash or London interbank offered rate
(Libor) notes (see "Security Definitions" on page 68).
Other Japan-related derivative products offered on the exchange are the Nikkei 225 futures and options, Nikkei 300 futures and options, Euroyen futures, Euroyen LIBOR (London InterBank Offered Rate
) and TIBOR (Tokyo InterBank Offered Rate).
Traders wanting to buy Computer Associates' commercial paper on Monday had been seeking yields of 115 basis points, or 1.15 percentage points, over the London Interbank Offered Rate
. In contrast, the identically rated commercial paper of Walt Disney Co.
These concerns were manifested in additional premia on yen- and dollar-denominated LIBOR (London Interbank Offered Rate
) deposits that Japanese banks had to pay to borrow money.
"The use of derivative instruments in managing various financial risks is critical to the operations of many banks and other entities, and it is important that in this time of industry transition away from the London Interbank Offered Rate
(LIBOR) that the accounting standards are proactive and meet the needs of the developing markets," the American Bankers Association wrote in its comment letter.
The case is against two former Deutsche Bank (NYSE: DB) traders accused of rigging the London Interbank Offered Rate
. The move comes after a Manhattan judge said the outcome of the case could depend on the evidence that the official could share.