BMO Capital Trust The company which I chose is BMO Capital Trust. The BMO Capital is a member of the BMO Financial Group. The trust is a close-ended trust established under the law of the province of Ontario. The company is a subsidiary of Bank of Montreal. The BMO Trust Capital was incorporated in 2000. The company’s headquarters is based in Toronto, ON. The BMO Financial Group is one of the leading financial services provider in Canada. It has total assets worth US$513 billion and above 45,000 employees as of October 31, 2016. The trust issues and sell basically two types of securities to all of its investors, a series of transferable trust units called “Trust Capital Securities” or also known as “BMO BOaTS”, and “Special Trust Securities”. …show more content…
The main purpose of the Trust Capital Securities is to provide the Bank of Montreal with a cost effective means of raising capital for Canadian bank regulatory purposes. The Bank of Montreal performs as an administrative agent in the BMO Capital Trust. The Bank issued an initial public offering of $450,000,000 of trust subordinated notes all over Canada on December 18, 2008 and may also issue further series of trust …show more content…
BMO Capital Market. I would analyse the financial position of the company from investors’ point of view to make important decisions. (BMO Financial Group, 2016) (BMO Capital Markets, 2016) (Bloomberg, 2016) (Ontario Securities Commission , 2016) Analysing the company for Investor’s position: Ratio Analysis is very important tool for analysing the financial position of the company. The ratios which I would use to analyse the company as an investor are as follows: 1. Current ratio: The Current ratio helps us to understand the ability of the company to pay its short- term liabilities against its short- term assets. If the current ratio is high then it means company can pay its debts easily and is in a good position to overcome any hurdles during the market fluctuation and vice-versa. The current ratio is calculated as follows: Current ratio = __Current Asset___ Current Liabilities 2. Debt to equity ratio: The debt to equity ratio helps an investor to identify proportion of the company financing that comes from shareholders equity (Investors) and the amount that has been borrowed (i.e. debt). The lower the debt to equity ratio means more financially strong business and higher the debt to equity ratio means higher risk for
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Suppliers are mostly concerned with a company 's ability to pay on their liabilities. Therefore, the current ratio and the quick ratio are both looked at by suppliers. The current ratio takes a company’s current assets and divides that by the company’s current liabilities. This number is
Net working capital represents organization’s operating liquidity. In order to compute the net working capital, total current assets are divided from total current liabilities. When there is sufficient excess of current assets over current liabilities, an organization might be considered sufficiently liquid. Another ratio that helps in assessing the operating liquidity of as company is a current ratio. The ratio is calculated by dividing the total current assets over total current liabilities. When the current ratio is high, the organization has enough of current assets to pay for the liabilities. Yet, another mean of calculating the organization’s debt-paying ability is the debt ratio. To calculate the ratio, total liabilities are divided by total assets. The computation gives information on what proportion of organization’s assets is financed by a debt, and what is the entity’s ability to pay for current and long term liabilities. Lower debt ratio is better, because the low liabilities require low debt payments. To be able to lend money, an organization’s current ratio has to fall above a certain level, also the debt ratio cannot rise above a certain threshold. Otherwise, the entity will not be able to lend money or will have to pay high penalties. The following steps can be undertaken by a company to keep the debt ratio within normal
Equity ratio and debt ratio are both very important because it shows how much of the assets used for production is really owned by the owner of a company. According to calculations in the appendix, RBC has the highest equity ratio and the lowest debt ratio. This is considered favourable compared to Sun life and BMO’s equity and debt ratio. When it comes to return on total assets BMO has the highest return. Meaning it is earning more per assets than RBC and Sun
The return on equity ratio is calculated by dividing the net income minus dividends by the equity. Per the Principles of Accounting textbook, “return on equities ratio enables the comparison of capital utilization among firms…this can help assess of effective the firm is in using borrowed funds”. Kinder Morgan’s return on equity ratio for December 2015 was .59%. In 2013 the ratio was 9.14% and in 2014 it was 3.01%. The return on equity ratio, like the return on assets ratio significantly declined over the past three years. One significant decrease to cause this decline is due to the deterioration of net income. Kinder Morgan’s net income from 2013 to 2015 was $1.19 billion, $1.02 billion, and $240 million successively. This sharp decline in net income can cause misplaced judgment on the decline of the debt ratios. When Kinder Morgan had a much higher income, their debt ratios were much
When comparing the debt-to-assets ratio of McDonalds and Wendys, you have to divide the firms total liabilities by their total assets. Essentially, the debt-to-assets ratio is the primary indicator of the firms debt management. As the ratio increases or decreases, it indicates the firms changing reliance on borrowed resources. The lower the ratio the more efficient the firm will be able to liquidate its assets if operations were discontinued, and debts needed to be collected. In 2005 Wendy's had $2,076,043 worth in total assets and $846,264 in total liabilities. When divided, Wendys has the lower ratio of the two competitors at 40%. This means that they would take losses of 40% if operations were shut down, and the cash received from valuable assets would still be sufficient to pay off the entire debt. It also means that 40% of Wendys assets are made through debt. McDonalds in 2005 had $12,545.3 (in millions) of total liabilities and $22,534.5 (in millions) of total assets. After doing the math, McDonalds ends up with a ratio of 56% which is higher than Wendys by sixteen percent. This means that there is more default on McDonalds liabilities, which can be a costly event from lenders perspective. McDonalds makes 56% of all its assets through debt. In reality, its not good to have a debt-to-assets ratio over 50%. Its also not good to have a debt-to-assets ratio that is too low because...
This section will discuss ratio analysis for the following ratios: current ratio, quick (acid-test) ratio, average collection period, debt to assets ratio, debt to equity ratio, interest coverage ratio, net profit margin, and price to earnings ratio. Depending on the end user which ratio carries more importance, however, all must be familiar with ratio analysis. Details on each company's performance for each of these areas can be found in the attached ratio analysis worksheet.
In 1986, Mortgage-Backed Securities(MBSs) was introduced. About this, Esty, Tufano and Headley (1998) described that “Banc One replaced many of its municipal investments with MBSs, which were fixed-income investments whose payment stream was backed by pools of mortgage loans and which were
The company offers mergers and acquisitions advice, underwriting services, asset management, and prime brokerage services to its clientele which is made up of governments, corporations and institutions alike. Along with being a primary dealer in the United States Treasury security market, the company also offers market making and private equity deals.
Ratios traditionally measure the most important factors such as liquidity, solvency and profitability, as well as other measures of solvency. Different studies have found various ratios to be the most efficient indicators of solvency. Studies of ratio analysis began in the 1930’s, with several studies of the concluding that firms with the potential to file bankruptcy all exhibited different ratios than those companies that were financially sound.
BlackRock was born under the umbrella of The Blackstone Group. The firm initially focused solely on fixed-income. By listening to and understanding their client’s needs that were unmet, their firm was able to progress. It developed important early innovation in relation to closed-end funds, trusts, defined contribution plans and many more. One such innovation was Blackstone Term Trust, which was able to accumulate $1 billion and put the business on a steady path for growth and success.
The 50 percent ownership of BlackRock Inc., itself having $1.26 trillion in assets on 30th September 2008 would also be a huge asset to BofA. Merrill, because there was not an overlap in the customer base, and more importantly for ML’s global reaches of clients. These add strength to BofA’s debt and equity underwriting, sales and trading etc., making it an opportunity for BofA to expand their horizons.
Mutual funds can play an important role in the growth of the economy of a country. Mutual funds are a desired investment destination for each individual/ organization if the fund houses offer not only the expertise in the management of the resources, but also many other services. A unit trust is a medium of communication for investing in shares and bonds. It is not an alternative choice for an investment in stocks and bound; but rather pools the money of different investors and invests it in stocks, borders, money mutual fund pools resources of thousands of investors and diversifies its investments in many different companies, such as shares, bonds and other securities spending extremely relative safety and efficiency. Mutual funds have become one of the most effective and attractive opportunities for the average person to invest their money. Mutual fund is a process or system or structure of pooling the saving of large number of investors with a purpose or objective of effective yield and appreciation in their value Mutual Funds managers have a range of investment products but still in our country is not to classify this sector or analyzes various custom products, the investor should therefore.