Speculating on the rise – and fall – of security prices
Put and call options are quite well known among a large crowd. The ‘straddle’ however, is less familiar to the general public. It became famous after its (mis)use by Nick Leeson, which caused the bankruptcy of Barings Bank in 1995. In this article the structure of a straddle is discussed, as well as the opportunities and dangers of this product.
SEPA as lever for supply chain financing
The Single Euro Payments Area (SEPA), as a subset of the ISO 20022 XML standard, promised companies standardization and effi ciency across the eurozone and non-euro countries that have accepted the SEPA standard (e.g. Denmark and Switzerland). SEPA adoption however falls far behind expectations. Shifted priorities due to the 2008 credit crisis and the fact that some popular local payment products have been kept outside the SEPA scheme are often cited as the culprits.
Most banks have significant amounts of non-maturing products on their balance sheets, such as current accounts and savings deposits. The contractual maturity is very small, so that the client could withdraw his or her money at short notice and banks can adjust interest rates at any time.
Alternative valuation method in the sustainable energy industry
Zanders has been involved in financing issues and transactions related to sustainable energy for several years now, supporting developers, power companies, and start-ups in a variety of countries.
As part of one of its consultancy projects, Zanders advised a Dutch developer on the valuation of its German wind farms. For this particular client, Zanders calculated the value of the implicit option embedded in the complex financing of wind energy projects.
Developments Healtcare institutions
The Dutch healthcare sector is in flux. The newspapers report on new developments almost on a daily basis.
In the previous issue of Zanders Magazine we argued that the credit crisis came at the wrong time for this sector: precisely at the moment when the risks are increasing, the banks reduce their lending.