Guide to Analysing Companies

MATIF
See marché à terme des instruments financiers.
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Maturity
The date on which the principal of a redeemable loan
becomes repayable.
 Original maturity. The length of time from the issuing of
a security or loan to the date of the last repayment.
 Residual maturity. The time left from today to the final
repayment.
So a bond due to mature on January 1st 2010 will return the
principal and final interest payment on that date. Some loans
do not have a redemption date. They continue for as long as
the interest owed on them is paid.
Mayday
The day of New York’s big bang, May 1st 1975.
MBO
See management buy-out.
Medium-term note
A bond with, as the name suggests, a medium life span,
usually anything between nine months and 30 years. Medium-
term notes became popular during the 1970s when companies
were looking for an alternative form of financing to commer-
cial paper. Medium-term notes are usually sold as and when
a company needs them (hence the term medium-note pro-
gramme). They are therefore rarely underwritten by an in-
vestment bank, as happens with other forms of bond. So if
they do not sell, the issuer does not get the money.
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MEDIUM-TERM NOTE
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Merchant bank
A UK investment bank engaged in corporate finance, port-
folio management and a range of other activities for fees.
Unlike a clearing bank, a merchant bank is not heavily in-
volved in taking deposits, running personal bank accounts
or in issuing and clearing cheques. Many of these banks owe
their origins to trading houses established during the 19th
century by families such as the Hambros, Schroders, Roth-
schilds and Lazards. Hence the term merchant bank.
In the United States, a merchant bank is part of an investment
bankthatadvisesonmergers and acquisitions,underwrites
securities and takes positions on its own account in certain
markets.Italsocoversbanksthatacceptdepositsfrommerchants
stemming from credit card or charge card transactions.
I always said that mega-mergers were for megalomaniacs.
David Ogilvy