A Medium-Term Note is a form of privately placed debt in a bond format. They are especially useful to those people wishing to raise funds quickly, such as asset managers. A MTN dealer acts as an intermediary to an investor, executes transactions and provides hedging.
Key learning objectives:
Identify why companies issue MTNs, and who buys them
Discuss the role of a dealer in issuing MTNs
What is the motivation for a company to consider an inaugural private placement?