Académique Documents
Professionnel Documents
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FII Loans
ADR/GDR ECB
FCCB
• History – 1927
• What are DRs ?
• Why DR s?
• Mechanisms
• DR s are US Negotiable Securities issued by a depositary
bank that represent the ownership of certain underlying
shares of a non US Company.
Fair Valuation
Privatization
• DRs are frequently identified by the markets in
which they are available or the rules and regulations
associated with the structure.
OTC Market
Exchange Listed
Capital Raising
Privately Placed
1. Purchase request
2. Contact to purchase
3. Shares Purchase
4. Depositing Shares
5. Confirmation
6. Issue of DR s
7. Transfer of DR s
Underlying Shares
Agreement Issuer Local
Company Custodian
Money Dividends
Money DR s DTC/EuroClear
/ Clear sream
Dividends
Foreign
Investors
Sale of DRs:
Intra market trading
Cancellation (Cross border trading)
1. Cancellation Request
2. Surrender DR s
3. Confirmation
4. Release of Shares into home market
• Due to the mechanisms involved , DR s are prone to following
risks
Inflation Risks of the respective countries
Political risks
Project Financing
• Restrictions:
Investment in Capital Markets
On Lending of funds