International Equity And Debt Products
Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Bank Financial Management — CAIIB.
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What is an American Depositary Receipt (ADR)?
An ADR is a negotiable certificate issued by a US depositary bank representing a specified number of shares in a foreign company's stock, traded on US stock exchanges in US dollars.
What is a Sponsored ADR program?
ADR issued with cooperation of the foreign company itself.
What is the difference between a Level I and Level III ADR?
Level I ADRs trade OTC with minimal SEC disclosure; Level II ADRs list on major exchanges with full SEC reporting; Level III ADRs allow the foreign company to raise fresh capital in the US market with the highest disclosure requirements.
What is an Unsponsored ADR?
ADR created without involvement of the foreign issuing company.
What is a Global Depositary Receipt (GDR)?
A GDR is a bank certificate issued in more than one country for shares in a foreign company, allowing the company to raise capital simultaneously in two or more markets outside its home country.
What is a Level II ADR?
Listed on US exchange but cannot raise new capital.
What is a Foreign Currency Convertible Bond (FCCB)?
An FCCB is a quasi-debt instrument issued by an Indian company in a foreign currency that can be converted into equity shares or depositary receipts at a predetermined price and exchange rate, combining features of both bonds and equity.
What is the Indian Depositary Receipt (IDR)?
Foreign company shares held by Indian depository and traded in India.
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