Issuance & underwriting | SIE Debt securities

Term Issuance

All bonds are issued on the same day and mature on the same day.

Serial Issuance

All bonds are issued on the same day, but mature on different days.

Series Issuance

Bonds are issued on different days, but all mature on the same day.

Balloon Maturity

A specific variation of serial issuance where a large portion of the issue matures at the final redemption date.

Price Quotes

Reflect the market price of a bond expressed as a percentage of par value.

Yield Quotes

Reflect the overall rate of return delivered by the bond.

Basis Points

A precise unit of percentage measurement representing one-hundredth of one percent.

Firm Commitment Underwritings

The underwriter purchases the securities from the issuer and assumes responsibility for any unsold securities.

Best Efforts Commitment Underwritings

The underwriter acts as an agent to sell securities without the obligation to purchase unsold shares.

Common Quote Formats for Term Issuance

Quoted in price form, known as dollar quotes, percentage of par quotes, or term quotes.

Typical Issuers for Serial Issuance

Municipalities, such as state and city governments.

Example of a Balloon Maturity

A bond issue where smaller amounts are redeemed at intervals, with the largest portion maturing last.

Equivalence of Basis Points

1 basis point = 0.01%; 100 basis points = 1.00%.

Risk Profile of Firm Commitment Underwritings

High financial risk to the underwriter, commanding higher underwriting fees.

Risk Profile of Best Efforts Commitment Underwritings

Lower risk to the underwriter, resulting in smaller underwriting fees.