The Credit Crisis has shown that similar rules apply to Nations as Institutions; confidence in the ability to repay or perform to expectations dictates price and availability of capital. The price is somewhere between use of the innitial liquidity and the probability to call in emergences. Equity pricing needs to encompass the causal-framework to which the issuer responds, it is not a simple discounted pricing model.
Where are the risks?
We need to understand the past. What are the traditional reports and processes?
What's your management style?
Talking to key staff is vital to understand the internal dynamic.
The start of combining the data to inform the models begins with downloading them into our system.
Crunch the numbers, build the network, triangulate the pricing and discuss the outcomes.
Choices to be made
How did we do? Compare strategies, raising the capital, setting the process of review or thanks and see you next year?
Raising the Capital
It's just a contract and the facility will be in place so commitment is a short process and costs typically lower than market brokers.
The economy is dynamic so we would want to regularly talk through changes. Major strategic moves alters our risk so getting comfortable is necessary.
Drawdown or peaceful placement
The price is pre-agreed, the assets pre-placed and a call to drawdown should facilitate action within 72-hours.