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Banking Essentials - Part I
This pathway will walk us through the basics of banks, starting with some of the different types and their main functions, then starting to look at the regulation faced by the banks, both before and after the Global Financial Crisis.
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Tackling the Cost of Living Crisis
In this video, Max discusses the cost-of-living crisis currently enveloping the UK. He examines its impact on households as well as the overall economy.
CSR and Sustainability in Financial Services
In the first video of this two-part video series, Elisa introduces us to sustainability. She begins by looking at the difference between sustainability and corporate social responsibility, two terms that can be easily confused.
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Discover our Courses
Featured Pathways
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Banking Essentials - Part I
This pathway will walk us through the basics of banks, starting with some of the different types and their main functions, then starting to look at the regulation faced by the banks, both before and after the Global Financial Crisis.
Greenwashing
Greenwashing is the act of distributing false information about something being more environmentally friendly than it actually is.
More pathways
Ready to get started?
Plans & Membership
Find the right plan for you
Our Platform
Expert led content
+1,000 expert presented, on-demand video modules
Learning analytics
Keep track of learning progress with our comprehensive data
Interactive learning
Engage with our video hotspots and knowledge check-ins
Testing & certification
Gain CPD / CPE credits and professional certification
Managed learning
Build, scale and manage your organisation’s learning
Integrations
Connect Finance Unlocked to your current platform
Featured Content
More featured content
Tackling the Cost of Living Crisis
In this video, Max discusses the cost-of-living crisis currently enveloping the UK. He examines its impact on households as well as the overall economy.
CSR and Sustainability in Financial Services
In the first video of this two-part video series, Elisa introduces us to sustainability. She begins by looking at the difference between sustainability and corporate social responsibility, two terms that can be easily confused.
More featured content
Ready to get started?
Our Solutions
About Us
Testimonials
More testimonials
Mark Homans
Our sky high NPS following learner feedback speaks for itself - this platform has delivered a lot of value.
Fiona Quinn
Learning is accessible and the tool assists in the continued development of all our employees. It is a fantastic tool for our business!
More testimonials
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Convertible Bond Adjustment Calculations
Mark Dalton
20 years: Equity capital markets
In the first of this two part series, Mark uses his experience as a calculation agent to provide insight into how the role helps both issuers and investors to understand how calculations impact them. He delves into adjusting the conversion price when an issuer has convertible bonds outstanding and is due to pay a dividend, as well as dealing with cash settlement conversions.
In the first of this two part series, Mark uses his experience as a calculation agent to provide insight into how the role helps both issuers and investors to understand how calculations impact them. He delves into adjusting the conversion price when an issuer has convertible bonds outstanding and is due to pay a dividend, as well as dealing with cash settlement conversions.
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Convertible Bond Adjustment Calculations
5 mins 5 secs
The calculation agent is responsible for carrying out the calculations set out in the terms and conditions of the transactions. The role of a calculation agent is to be able to help the issuers and investors understand how those calculations affect them.
Key learning objectives:
Understand how a Calculation Agent helps its clients
Understand how an issuer settle convertible bonds after the investor converts it
Describe the Net Share Settlement
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What are the tasks performed by a Calculation Agent?
- They determine the prevailing share price, as defined in the terms and conditions of the bonds – usually, though not always, this is the average of five daily VWAPs
- They apply relevant formulas in the terms and conditions to reduce the conversion price by the same percentage as either the full amount of the dividend, or the excess dividend over some base amount, expressed as a percentage of that share price
What are the two most common ways for an issuer to settle convertible bonds?
- The first, and easiest one, is for the issuer to simply deliver a number of shares equal to the amount of the bonds converted, divided by the conversion price
- Net Share Settlement - the issuer has to deliver an amount of cash equal to the par value of the bonds, plus a number of shares calculated by deducting the value of that cash repayment from the value of the total number of shares over a forward-looking averaging period, in the same way as for a cash settled conversion
For an issuer, having a good calculation agent means that they can rely on the overview numbers given to them and concentrate on the settlement process rather than the calculations.
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