Search results for

What awaits hybrid bond investors in 2014

Here’s how to build effective compliance programmes and codes of conduct under the FCPA Guide and UK Bribery Act Guidance

A closer look at non sequiturs, value leakage and work paper disclosures in PRC listings in the US

Some key developments for sukuk finance in 2012 have set the stage for the year ahead

Patricia Aracely Solórzano Flores The use of ATMs (automatic teller machines) has become an important part of our lives; their popularity relies on the fact that they allow card holders to have quick and easy access to cash whenever they need it, thus avoiding the risk of getting robbed or losing money. However, due to technological advances, the security provided by ATMs is becoming outdated. Yet the use of security measures to protect users from being victims of crime is compulsory. Based on this necessity, and on the increasing number of complaints received at the Financial User Protection Office from ATM users, on December 6 2012 the Honduran Banking and Insurances National Commission issued the Safety Standards for Operating ATMs (Safety Standards). This represents the general trend of financial regulation in Honduras, where the user has become the central figure. Before the Safety Standards, card issuers were only required to implement proper measures to identify the card holder, but there were no rules regulating physical safety at ATMs. Today, according to the Safety Standards, ATM owners must comply with security guidelines, such as (i) employ mechanisms that guarantee the privacy of the transactions made in them, so that the information used is not available to third parties; (ii) take appropriate security measures in the places where ATMs are installed; video cameras must have good resolution for recording and storing images and movements of the events that occur at ATMs, and should allow the identification of the ATM user; (iii) external ATMs must be installed in an enclosure, the access door must have an internal mechanical locking device, to prevent third party access into the enclosure when the client or user is using the ATM, or if it is not in an enclosure then it must have physical security (a security guard) during public opening hours, or when the use of the ATM requires so.

A leading general counsel reveals his strategies for staying on top in a challenging market

More and more foreign companies are utilising UK schemes of arrangement. It begs the question, what are the limits of this restructuring tool?

Banji Adenusi As debt securities issued by governments, government agencies, and corporations, bonds are an external source of funding for the expansion of an issuer's business (as in the case of corporate bonds), or for the development of infrastructure projects. In recent times, the primary market for corporate bonds in Nigeria has witnessed tremendous growth, as the number of corporate bonds listed on the Nigerian Stock Exchange has risen to a respectable 18 as of January 2013. While the issuance of government bonds and corporate bonds is regulated by the Nigerian Securities and Exchange Commission (SEC), the incidence of covered bonds is altogether a different proposition, as applicable legislation in this regard is non-existent. The United States Federal Deposit Insurance Corporation describes covered bonds as "general, non-deposit obligation bonds of the issuing bank secured by a pledge of loans that remain on the bank's balance sheet". Essentially, the defining feature of covered bonds is the duality of protection offered to investors, namely: (a) liability of issuer (typically a financial institution) for repayment; and (b) the special pool of collateral, also known as cover pool, on which investors have a preferential claim in the event of the issuer's insolvency. Typically, these collaterals are by way of high-grade mortgages or loans to the public sector or shipping loans. When contrasted with asset-backed securities (ABS), the cover pool becomes credit enhancement leverage, as they are more dynamic in the sense that assets can be added or replaced in the pool over time, especially where the value of these assets diminish or an early repayment has occurred. In addition, the credit risk stays with the issuer, as the borrower continues to absorb the risk of default and prepayment risk of the pool; much unlike ABS where the issuer does not absorb the risk of default beyond the agreed credit support and risk of prepayment is usually transferred to the investor. Herein lies the major difference between covered bonds and securitisation in general.

A lawyer acting on the Interbolsa liquidation speaks exclusively to IFLR about its impact on investors and its legacy for financial regulation

Carlos Fradique Méndez Lucas Moreno In late December 2012 Colombian Congress passed Law 1607, which introduces significant changes to Colombian tax law, with some provisions particularly relevant to the structuring of inbound and outbound financial transactions. This article, very briefly and generally describes some of the most salient features of the tax reform, with the proviso that the specific details and implementing rules and regulations are to be taken into account in specific cases given the complexity of the subject matters. The tax reform generally reduces the withholding tax rate applicable to gross payments to foreign portfolio investors from 33% to 14%. The 14% rate is generally applicable, unless the foreign investor is located in a tax haven (as indicated in a blacklist to be published by the Colombian Government), in which case the applicable withholding rate would be 25%. While dividends are not typically subject to double taxation, the 14% reduced withholding rate would not apply (and a 25% withholding rate would be applicable instead) to dividend payments subject to taxes in Colombia at the shareholder level.