CORPORATE INSTRUMENT MONETIZATION
A corporate instrument is typically a corporate bond backed by assets the corporation owns — cash, stock or other assets — written into the bond. Its bankable value is only as real as those assets. Once bankable, it is monetized by blocking it on behalf of a recourse or non-recourse lender, typically for a year and a day; Magister Operis has direct access to monetization sources for corporate instruments.
How the Eleven Items Apply
The eleven pre-compliance items make a deal bankable whatever the asset. For a corporate instrument, these are the particulars:
- The issuer's standing: registration and audited financial statements (item 2: Corporate Profile)
- Confirmation from the institution holding the bond: issuer, face value, maturity and owner (item 3: Proof of Ownership)
- Independent evidence of every asset backing the bond: statements from the institutions holding the cash or stock, and appraisals for other assets (item 4: Valuation & Appraisals)
- The bank that will hold and block the bond under its own banking responsibility (item 9: Banking Relationships)
What Stands Behind It
Some corporate bonds are registered securities and others are not; registration on an exchange carries more weight. Even so, writing a bond and listing it are paid services, and neither makes the bond bankable. A funding bank lends against the assets behind it, verified independently. The burden is on the bond's UBO to evidence that those assets have bankable value.
| Backing | What the funding bank needs |
|---|---|
| Cash | A statement from the bank holding it, in the issuer's name |
| Stock | A custodian statement, and the shares' market value and liquidity |
| Other assets | Independent appraisal and proof of the issuer's ownership |
| Registration | A registered security carries more weight than an unregistered bond |
| Data listing | Appearing on Bloomberg or a similar terminal shows the bond is listed and the fee paid — not that it has value |
First impressions are formed by the documents. The eleven pre-compliance items, the monetization workflow, and three ways to get the paperwork right — prepare it yourself, engage a professional, or retain Magister Operis — apply to every asset class: Monetization & Trading.
Every engagement is governed by the firm's Method and Disclaimer; intermediaries should also review Broker 101 and the firm's Due Diligence standards.