Guide to Analysing Companies

Bulldog bond
A bond that is denominated in sterling but issued by a non-UK
borrower.
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BULLDOG BOND
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Bullet
A loan on which all the principal is repaid in one go at the
end of the period of the loan. During the life of the loan the bor-
rower pays interest only. Although they are not called bullets,
some retail mortgages are effectively the same, in that they rely
on investment plans, called endowment policies, to pay off the
loan in full at the end of its life.
Bundesbank
Germany’s central bank. As central banks go, the Bundes-
bank has a long tradition of being independent of government.
Since Germany is a member of the european monetary
system and the European System of Central Banks (escb); the
president of the Bundesbank also sits on the General Council of
the european central bank.
Bunny bond
A bond where the holder has the option to receive interest
in cash or in the form of more of the same bond.
Bureau de change
A small office trading in foreign exchange, often found in
places where travellers first set foot on foreign soil, such as air-
ports and railway stations, as well as in shopping areas. A
bureau de change makes a profit by charging a commission
(usually a percentage of the amount exchanged) or by the turn
it makes on the buying and selling of the currency, that is, the
difference between the price it pays for the foreign currency
and the price at which it sells it. Evidence that bureaux de
change have been used as conduits to launder money made
from drug dealing and to transfer cash used by terrorists has
rekindled authorities’ efforts to ensure that they are properly
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regulated. International agencies affiliated to the oecd want
national governments to encourage bureaux de change to report
any suspicious transactions.
Buy-back
An agreement in a sales contract under which the seller
agrees to buy back an asset if certain conditions are (or are
not) met within a certain period of time: for example, an
agreement to buy back a house if the purchaser has to move
on within a certain period; or an agreement to buy back a
shareholding in a company if it fails to meet a certain level
of sales or if the authorities change the regulations under
which it operates.
The term is also used to describe the purchase by companies
of their own shares. They do this to improve their earnings
per share (total profits divided by the total number of
shares in the issue). The fewer shares there are in issue, the
better the earnings appear.
Buyer credit
A medium- to long-term loan granted by a foreign buyer of ex-
ported goods. The loan is given by the exporter’s bank and
usually carries the guarantee of the exporter’s national
export credit agency.
Buyer’s market
A market in which there is a plentiful supply of commodities (or
securities, or whatever) and in which, as a consequence, prices
are weak and can often be negotiated downwards. Contrast
with seller’s market.