primary-issuance-syndication — Debt Capital Markets Practice Questions

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1. The 'new-issue concession' refers to:
2. What is the 'winner's curse' in the context of bond auctions (a concept related to market technicals)?
3. What is a 'bridge loan'?
4. Which component of the 'Gross Spread' (underwriting fee) usually rewards the specific bank that finds the inve
5. If a company buys a machine on January 1, by what date must it typically incur the debt and the lien to qualif
6. If a company has multiple bond issues outstanding, each with its own builder basket, which basket governs a po
7. Which of the following scenarios describes a 'legitimate' non-recurring add-back for a credit analyst evaluati
8. A DCM banker advises an issuer that its new deal will likely… — What does this term mean in practice?
9. What is the primary objective of TLAC (Total Loss-Absorbing Capacity) and MREL (Minimum Requirement for own fu
10. In the context of a syndicated loan, what is the function of the 'price flex' clause during the bookbuilding p
11. Why is the 'Leverage Ratio' a critical constraint for bank dealers even when holding safe assets like governme
12. A 'fallen angel' is best described as an issuer that has:
13. Which party in a syndicated loan typically provides the 'swingline' funding directly to the borrower?
14. What is 'fronting' in the context of a letter of credit issued under a revolving credit facility?
15. Which of these is a 'non-cash' use of a revolver that still blocks other borrowing?
16. What is the primary economic function of a bridge loan in a corporate acquisition?
17. In a committed financing package, what is the purpose of a 'flex' provision?
18. What is the 'bridge-to-takeout' window typically intended to accomplish?
19. In a bridge takeout, what is 'carry' cost for the issuer?
20. Which document in a syndicated loan or bond issue specifies the 'waterfall' or the order in which different cr
21. If a syndicate of banks executes a bond offering on a 'best-efforts' basis and investors only subscribe to 75%
22. A group of five relationship banks agrees to provide a $1 billion loan to a corporate borrower, with each bank
23. In a 'bought deal' scenario, if the underwriting bank cannot find enough buyers at the 'reoffer' price of 99.8
24. Why would an issuer ever choose a 'best-efforts' deal instead of a 'bought deal' if the latter provides more c
25. In a 'club deal', the 'Agreement Among Lenders' or similar documentation is important because:
26. A bank is 'pitching' a bought deal to a client. The client asks: 'What happens if the book is only 0.5x covere
27. Why would a bank *refuse* to do a 'bought deal' and insist on 'best-efforts' for a company with a 'Caa1' ratin
28. In an 'Underwritten LBO Bridge', the bank provides a short-term loan to ensure an acquisition can close, inten
29. What is the most likely result?
30. What is a 'Pricing Grid' in a syndicated loan?