prepare, apply, and confirm with myfinancelab
TRANSCRIPT
Prepare, Apply, and Confirm with MyFinanceLab⢠Prepare, Apply, and Confirm with MyFinanceLabâ˘
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1936.5â â˘â SomeâBondâHistoryâandâMoreâBondâFeatures
presentâtheâcouponâtoâtheâbondâsâtrusteeâforâpayment.âTheâtrusteeâwasâtypicallyâaâbank.âAfterâclippingâallâtheâcoupons,âonlyâtheâcorpus,âorâbodyâofâtheâbond,âremained.âTheâbondholderâpresentedâtheâcorpusâtoâtheâtrusteeâatâmaturityâforârepaymentâofâtheâprincipal.âWheneverâoneâownerâsoldâtheâbondâtoâtheânext,âtheâpriceâwasâaâreflectionâofâtheâcurrentâyieldâandâtheâremainingâorâunclippedâcou-ponsâandâbondâprincipal.âWhenâtheâownerâwishedâtoâsellâtheâbondâpriorâtoâma-turity,âtheânewâpotentialâownerâcouldâverifyâallâremainingâcouponâpaymentsâandâprincipalâbyâexaminingâtheâattachedâcouponsâandâtheâcorpus.âAsâaâresult,âtheseâbondsâearnedâtheânameâcoupon bonds.
Oneâproblemâwithâbearerâbondsâisâthereâisânoâregisteredâownerâsânameâprintedâonâtheâbond;âtherefore,âaâfinancialâinstitutionâcouldâpayâinterestâandâprincipalâtoâanyoneâtenderingâaâbondâcertificate,âregardlessâofâtheâtrueâowner.âToâavoidâprob-lemsâwithâstolenâbonds,âcompaniesâstartedâregisteringâtheâownersâandâmakingâcouponâpaymentsâandâprincipalârepaymentâbasedâonâtheâlistâofâregisteredâowners.âIfâanâownerâwantedâtoâsellâhisâorâherâbondâbeforeâmaturity,âtheâholderâwouldâneedâtoânotifyâtheâcompanyâofâtheâchangeâinâownershipâforâfutureâcouponâpayments.
Aâsecondâproblemâwithâbearerâbondsâisâthatâtheâcompanyâmightânotâbeâableâtoânotifyâtheâbondholderâofâaâsignificantâevent,âsuchâasâtheâcallingâinâofâtheâbondâpriorâtoâitsâmaturity.âWithâregisteredâbonds,âtheâcompanyâcanâcommunicateâwithâbondholdersâbecauseâtheâcompanyâhasâtheâofficialâlistâofâowners.
Todayâanâindentureâorâdeed of trustâaâwrittenâcontractâbetweenâtheâbondâissuerâandâtheâbondholderâspecifiesâbondâagreementâdetails.âAmongâotherâthings,âitâspellsâoutâtheâtermsâofâtheâbond,âtheânumberâofâbondsâforâissuance,âaâ descriptionâofâanyâcollateralâsupportingâtheâbond,âanyâspecialârepaymentâprovi-sionsâorâcallâoptions,âandâdetailsâofâprotectiveâcovenants.âWeânowâturnâtoâaâbriefâconsiderationâofâsomeâofâtheseâimportantâterms.
Collateralâorâsecurity of a bondârefersâtoâtheâassetsâthatâsupportâtheâbond,âshouldâtheâbondâissuerâfailâtoâmakeâtheâobligatedâcouponâpaymentsâorâprincipalârepayment.âCollateralâcanâbeâphysicalâassetsâsuchâasâcompanyâinventories,âequip-ment,âorârealâproperty.âCollateralâcanâalsoâbeâfinancialâassetsâsuchâasâcommonâstockâinâtheâcompany.âTheâuseâofâphysicalâassetsâtoâbackâloansâisâveryâcommon.âForâexample,âifâyouâpurchaseâaâcarâandâsecureâaâloanâthroughâaâbankâtoâpurchaseâtheâcar,âtheâbankârequiresâthatâyouâplaceâtheâcarâ(titleâtoâtheâcar)âasâcollateralâagainstâtheâloan.âTheâbankâsecuresâaâlienâagainstâtheâtitleâandâretainsâthisâlienâuntilâyouâfullyârepayâtheâloan.âIfâyouâfailâtoâmakeâyourâmonthlyâcarâpayments,âtheâbankâcanârepossessâtheâcarâasâpaymentâagainstâtheâloan.âIfâyouâfaithfullyâmakeâyourâcarâpayments,âhowever,âtheâbankâcannotârepossessâtheâcar.âTheâsameâisâtrueâofâcorpo-rateâbondsâwithâassetsâpledgedâasâsecurityâforâtheâpaymentâofâinterestâandâprin-cipal.âAsâlongâasâtheâcompanyâfaithfullyâmakesâtheâcouponâpaymentsâandârepaysâtheâprincipalâonâtime,âtheâbondholderâhasânoâentitlementâtoâtheâcollateral.âIfâtheâcompanyâshouldâdefaultâthatâis,âfailâonâitsâpromisedâpaymentsâtheâbondholderâisâentitledâtoâpossessâtheâpledgedâcollateralâasâpaymentâforâtheâbond.âWhenâyouâuseârealâpropertyâasâcollateral,âweâcallâitâaâmortgaged security.
Weâcallâunsecuredâbondsâdebentures,âwhichâsimplyâmeansâthatâtheâbond-holderâhasânoârecourseâagainstâspecificâassetsâofâtheâissuingâcompany,âshouldâtheâcompanyâfailâonâitsâpromisedâpayments.âTheâmajorityâofâbondsâissuedâinâtheâUnitedâStatesâtodayâareâdebentureâbonds.
Whenâaâcompanyâgetsâintoâfinancialâdifficultyâandâcannotâpayâitsâcredi-tors,âcreditorsâlineâupâinâaâpredeterminedâorderâforârepaymentâofâtheirâclaims.âCreditorsâatâtheâfrontâofâtheâlineâareâseniorâtoâcreditorsâbehindâthemâinâline.âItâisâalsoâtrueâthatâcompaniesâcanâissueâmoreâthanâoneâsetâofâbondsâatâdifferentâpointsâinâtime.âTheâoldestâbondsâareâsenior debtâoverâtheâmoreârecentlyâissuedâ
Chapterâ6â â˘â BondsâandâBondâValuation194
junior debt,âsoâthoseâholdingâtheâoldestâbondsâ areâentitledâtoâcouponâpaymentsâandâprincipalâ repaymentâaheadâofâthoseâholdingâtheâmoreârecentâbonds.
Theâfinalâprincipalâpaymentâofâaâbondâissueâcanâbeâaâsubstantialâcashâoutflowâforâaâcompany.âToâmeetâthisâobligation,âaâcompanyâmayâhaveâtoâbuildâaâfundâoverâtimeâtoâaidâinâtheâprincipalâpayment.âWeâcallâthisâaâsinking fund.âTheâcompanyâmakesâannualâpaymentsâintoâtheâsinkingâfund,âusuallyâmanagedâbyâaâtrustee,âtoâensureâthatâtheâcompanyâcanâretireâtheâbondsâatâmaturity.âAâcompanyâcanâuseâtheâsinkingâfundâtoâbuyâbackâsomeâofâtheâbondsâoverâtimeâorâtoâcallâinâbondsâearly,âorâitâcanâletâtheâbondâownersâholdâthemâuntilâbondâmaturity.âTheâspecificâdetailsâofâtheâsinkingâfundâareâdetailedâinâtheâindenture.
Withinâtheâindentureâofâtheâbondâisâaâsetâofâprotective covenants.âTheâcovenantsâspellâoutâ bothârequiredâandâprohibitedâactionsâofâtheâbondâissuer.âTheâcovenantsâusuallyâprotectâtheâbondholderâ
againstâactionsâthatâtheâcompanyâmightâtakeâthatâwouldâdiminishâtheâvalueâofâtheâbond.âForâexample,âtheâindentureâmightâstateâthatâtheâcompanyâmayânotâsellâandâleaseâbackâassetsâthatâitâusesâasâcollateralâforâaâbond.âAâsaleâandâleasebackâwouldâeffectivelyâremoveâtheâcollateralâfromâtheâbondâbecauseâtheâtitleâforâtheâcollateralâwouldâtransferâtoâaânewâowner,âleavingâtheâbondholderâwithânoârecourseâtoâtheâpromisedâcollateralâinâcaseâofâdefault.âInâgeneral,âprotectiveâcovenantsâprotectâtheâbondholderâandâenhanceâtheâvalueâofâtheâbond,âthusâhelpingâtheâcompanyâsellâtheâbondâatâaâhigherâprice.
Issuersâmayâsellâbondsâwithâattachedâoptions.âTheseâoptionsâentitleâeitherâtheâbondholderâorâtheâcompanyâtoâspecificâfutureâactions.âOneâofâtheâmostâcommonâoptionsâisâaâcallâoption.âAâcallable bond,âasâweâbrieflyâmentionedâearlier,âallowsâtheâbondâissuerâtoâcallâinâtheâbondâpriorâtoâmaturityâatâaâpredeterminedâprice.âAâbondâissuerâexercisesâthisâoptionâwhenâinterestâratesâareâfallingâsoâthatâtheâinstitu-tionâcanâreissueâtheâdebtâatâaâlowerâcost.âTypically,âtheâissuerâcannotâexerciseâtheâcallâoptionâinâtheâfirstâfewâyearsâofâtheâbond,âandâtheâcallâpriceâisâusuallyâaâpre-miumâoverâtheâparâvalue.âTheâsizeâofâtheâpremiumâfallsâasâtheâbondâapproachesâitsânaturalâmaturityâdate.
LetâsâlookâatâaâcurrentâbondâforâPacificâBellâ(Fig.â6.9),âwhichâtheâcompanyâoriginallyâissuedâonâOctoberâ15,â1993,âasâaâcallableâbondâwithâaâforty-one-yearâmaturity.
Afterâtwentyâyears,âPacificâBellâcanâcallâtheâbond.âThus,âtheâbondâcouldâbeâcalledâasâearlyâasâOctoberâ15,â2013.âInâthisâinstance,âtheâbondholderâmustâsellâtheâbondâtoâPacificâBellâatâaâpresetâprice.âTheâpresetâpriceâatâtheâfirstâcallâdateâmightâbeâtheâprincipalâofâtheâbondâplusâoneâextraâcouponâpayment.âHowâdoesâoneâpriceâthisâcallableâbond?
Theâyield to callânowâreplacesâtheâyieldâtoâmaturityâasâtheâdiscountârateâforâtheâbond.âInâPacificâBellâsâcase,âitâisâ6.277%.âTheâcashâflowâisâtheâpromisedâcashâflowâatâtheâfirstâcallâdate.âIfâPacificâBellâcallsâtheâbondâonâOctoberâ15,â2013,âandâpaysâtheâparâvalueâplusâoneâextraâinterestâpayment,âweâcanâdetermineâtheâcashâflow,âwhichâtheâtimeâlineâinâFigureâ6.10âillustrates.âAgain,âtheâcouponâpaymentâ
Figure 6.9 Pacific Bell semiannual callable corporate bond.
Pacific BellOVERVIEW
As of 1-Aug-2008
Price (% of par): 103.96Coupon rate: 6.625%Maturity date: 15-Oct-2034Yield to call: 6.277%Current yield: 6.340%Fitch ratings: BCoupon payment frequency: SemiannualFirst coupon date: 15-Apr-1994Type: CorporateCallable: Yes
1956.5â â˘â SomeâBondâHistoryâandâMoreâBondâFeatures
isâtheâcouponârateâtimesâtheâparâvalueâdividedâbyâ2âtoâreflectâtheâsemiannualâpaymentâofâcoupons:
coupon =$1,000 Ă 0.06625
2= $33.125
Asâofâtoday,âAugustâ1,â2008,âthereâareâelevenâcouponâpaymentsâandâaâfinalârepay-mentâofâtheâparâvalueâplusâanâextraâinterestâpayment.âTheâbondâisâpricedâtoâthisâcallâdateâofâOctoberâ15,â2013,âandâhasâaâyieldâtoâcallâofâ6.277%.âWeâwillâuseâaâspreadsheetâandâtheâTVMâkeysâonâaâcalculatorâtoâpriceâthisâbondâonâOctoberâ15,â2013:
Figure 6.10 Pacific Bell call-able bond cash flow.
$33.125 $33.125 $33.125 $33.125 . . .
T1T0 T3 T4 . . .
$33.125
T9
$33.125
T10
$33.125
T11T2
$1,033.125
Mode: P>Y = 2âandâC>Y = 2Input 11 6.277 ? 33.125 1,033.125
Key N I/Y PV PMT FV
CPT â1,039.56
Use the present value function to find the price of the bond.
A B C D E
1 Rate 0.031385
2 Nper 11
3 Pmt $ 33.125
4 Fv $1,033.125
5 Type 0
6 Pv ($1,039.56)
B6 fx =PV(B1,B2,B3,B4,B5)
Theâpresetâcallâpriceâonâaâbondâerodesâasâtheâcallableâbondâapproachesâitsâmaturityâdate.âTheâextraâpremiumâforâtheâearlyâcallâwillâeventuallyâfallâtoâzeroâonâOctoberâ15,â2034.âTheâownerâisânotâsureâexactlyâwhenâtheâissuerâmightâcallâtheâbond,âifâatâall,âsoâpricingâaâcallableâbondâisâmoreâdifficultâthanâpricingâotherâbonds.âItâisâprudentâtoâassumeâtheâissuerâwillâcallâtheâbondâatâtheâfirstâavailableâdateâandâtheâbondâsâpriceâwillâbeâtheâpriceâwithâaâmaturityâatâtheâfirstâcallâdate.
Twoâotherâoptionsâthatâtheâissuerâmightâattachâforâtheâbondholderâareâputâ andâconversionâoptions.âAâputable bondâgivesâtheâbondholderâtheârightâtoâsellâtheâbondâbackâtoâtheâcompanyâatâaâpredeterminedâpriceâpriorâtoâmaturity.âInâ effect,âitâisâtheâreverseâofâaâcallableâbond,âandâtheâbondholderâwouldâchooseâtoâexerciseâthisârightâtoâsellâwhenâinterestâratesâareârising.âAâconvertible bondâgivesâtheâbond-holderâtheârightâtoâswapâtheâbondâforâanotherâasset.âCommonâstockâinâtheâcompanyâisâtypical.âAâpresetâconversionâratioâexistsâforâtheâbondâsuchâthatâtheâbondholderâwillâreceiveâaâstatedânumberâofâsharesâofâcommonâstockâforâeachâbondâoneâredeems.
Chapterâ6â â˘â BondsâandâBondâValuation196
Theseâoptionsâareâvaluableâandâhaveâanâeffectâonâtheâbondâsâprice.âIfâtheâcompanyâholdsâtheâoptionâaâcallableâbondâtheâbondâsâpriceâisâlowerâthanâanâotherwiseâequalâbondâwithoutâthisâcallâoptionâattached.âIfâtheâbondholderâholdsâtheâoptionâaâputableâbondâtheâbondâsâpriceâisâhigherâthanâanâoth-erwiseâequalâbondâwithoutâthisâoption.âPricingâputableâorâconvertibleâbondsâisâbeyondâtheâscopeâofâthisâtextbook,âbutânoteâthatâweâaddâtheâputâsâpriceâorâconversionâoptionâsâpriceâtoâtheâstraightâbondâprice.âAâbondâissuerâcannotâtakeâawayâoptionsâfromâtheâoptionâholder,âbutâitâcouldâforceâtheâbondholderâtoâexer-ciseâtheâoutstandingâoption.âForâexample,âifâaâbondâisâbothâcallableâbyâtheâbondâissuerâandâconvertibleâbyâtheâbondholder,âtheâissuerâcouldâcallâinâtheâbondâandâforceâtheâbondholderâtoâeitherâsellâtheâbondâatâtheâcallâpriceâorâconvertâitâtoâcommonâshares.
Althoughâweâhaveâdealtâonlyâwithâfixedâcouponârates,âoneâfeatureâthatâcanâchangeâisâtheâbondâsâcouponârate.âIfâweâallowâthisârateâtoâchangeâoverâtime,âtheâbondâbecomesâaâfloating-rate bond.âAâfloating-rateâbondâsâannualâinterestârateâadjustsâbasedâonâaâbenchmarkârateâsuchâasâtheâprime rate.âTheâprimeârateâisâtheârateâthatâbanksâchargeâtheirâbestâcustomersâforâmoney.âWhenâtheâprimeârateâincreases,âtheâbondâsâcouponârateâandâpaymentâalsoâincrease.âWhenâtheâprimeârateâfalls,âtheâbondâsâcouponârateâandâcouponâpaymentâalsoâfalls.
Weâcanâalsoâtieâtheâpaymentâscheduleâandâcouponâamountâtoâaâcompanyâsâincome.âWeâcallâtheseâtypesâofâbondsâincome bonds.âIncomeâbondsâpayâcouponsâbasedâonâtheâcompanyâsâincome.âDuringâperiodsâofâlowâincome,âtheâcompanyâ reducesâorâeliminatesâcouponâpayments,âwhichâreducesâtheâprobabilityâofâdefaultâonâanâincomeâbond,âbutâalsoâreducesâitsâattractiveness.
Theâmoreâcreativeâtheâissuerâgetsâwithâtheâbondâsâfeatures,âtheâmoreâexoticâtheâbond.âInâgeneral,âexotic bondsâareâbondsâwithâspecialâfeaturesâdistinctâtoâthatâpar-ticularâbond.âForâexample,âyouâcouldâbuyâaâbondâinâoneâcurrency,âU.S.âdollars,âbutâreceiveâyourâcouponsâandâprincipalâinâeuros.âHowever,âtheâmoreâcreativeâtheâissuerâgets,âtheâmoreâdifficultâitâisâtoâpriceâtheâbondâandâtheâharderâitâisâtoâsellâit.âWithâtheseâspecialâfeatures,âtheâbondâattractsâfewerâpotentialâbuyersâandâisâlessâliquid.
Youâmayânotâbeâanâexpertâinâbondsâyet,âbutâyouâshouldânowâbeâproficientâatâpricingâstandardâbondsâwithâtheirâpromisedâsetâofâfutureâcashâpayments.âWeâwillâleaveâtheseâcreativeâfeaturesâofâbondsâforâanotherâfinanceâclass.
6.6 U.s. government bondsBothâTreasuryânotesâandâTreasuryâbondsâareâsemiannualâbonds.âTheirâonlyâdif-ferenceâisâtheâmaturityâorâageâofâtheâfinancialâasset.âTheâU.S.âgovernmentâissuesâTreasury notesâwithâmaturitiesâofâbetweenâtwoâyearsâandâtenâyears.âItâissuesâTreasury bondsâwithâmaturitiesâofâmoreâthanâtenâyears.âTheâTreasury billâisâaâshort-termâborrowingâinstrumentâwithâaâmaturityâofâlessâthanâoneâyear.âTheâTreasuryâissuesâone-monthâ(four-week),âthree-monthâ(thirteen-week),âsix-monthâ(twenty-six-week),âandâone-yearâ(fifty-two-week)âTreasuryâbills.âInâadditionâtoâhavingâshorterâmaturitiesâthanâtheânotesâandâbonds,âtheâTreasuryâbillsâareâzero-couponâinstrumentsâinâthatâtheyâpayâbothâtheâprincipalâandâtheâinterestâatâmaturity.
Thereâareâalsoâstate bonds,âissuedâbyâindividualâstateâgovernments,âandâmunicipal bondsâ(sometimesâcalledâmunis),âissuedâbyâcounty,âcity,âorâlocalâgovernmentâagencies.âToâseeâmunicipalâbondsâatâworkâinâaâjobâsetting,âreadâtheââPuttingâFinanceâtoâWorkââfeatureâinâthisâchapter.âInâaddition,âforeignâcorpora-tionsâandâgovernmentsâissueâforeign bonds.
1976.6â â˘â U.S.âGovernmentâBonds
Pricing a U.S. Government Note or Bond
SupposeâtheâU.S.âgovernmentâhasâannouncedâthatâitâintendsâtoâraiseâfundsâbyâsellingâaâseven-yearâTreasuryânoteâwithâaâ6%âcouponârateâwithâaâparâvalueâofâ$100,000.âLetâsâassumeâyouâwantâtoâbuyâoneâofâtheseânotesâandâwantâtoâearnâ8%âonâitâoverâtheâcomingâsevenâyears.âWhatâpriceâshouldâyouâpay?
Theâsameâprocessâappliesâhereâasâwithâaâcorporateâbond.âTheâfirstâstepâisâtoâsetâupâtheâcashâflowâfromâtheânoteâandâthenâdiscountâtheseâfutureâcashâpaymentsâatâtheâappropriateâdiscountârate.âTheâsemiannualâcouponâpaymentsâare
coupon payments =$100,000 Ă 0.06
2= $3,000
Figureâ6.11âdepictsâtheâtimingâofâtheâcashâflow.
Whetherâyouâhailâfromâaâbigâcityâorâaâsmallâtown,âyouâknowâthatâtheâfinancingâofâlargeâcapitalâprojectsâisâimportantâtoâtheâsmoothârunningâofâtheâcommunity.âThereâareâschools,âpoliceâstations,âandâlibrariesâtoâreno-vateâorâbuild.âTheâupkeepâofâwaterâsuppliesâandâsewerâsystemsâandâtheâpavingâandârepairâofâroadsâcanâcarryâsteepâpriceâtags.âCurrentâtaxârevenuesâcannotâfinanceâtheseâitems,âandâtheâavailabilityâofâgrantsâfromâtheâstateâorâfederalâgovernmentâisâunpredictable.
Enterâtheâmunicipalâmanager,âwhoseâjobâisânotâunlikeâthatâofâaâcorporateâCFO.âAmongâtheirâmanyâfinancialâ responsibilities,âtheseâmanagersâneedâtoâraiseâfunds,âandâoneâofâtheâchiefâwaysâtheyâdoâitâisâtoâsellâbonds.
Fortunately,âmunicipalitiesâhaveârelativelyâeasyâaccessâtoâcapitalâmarkets.âTheyâcannotâsellâstock,âofâcourse,âbutâevenâsmallâandâmedium-sizeâcommuni-tiesâhaveâbetterâaccessâtoâtheâbondâmarketsâthanâsimilar-sizedâcorporations.âHigh-incomeâinvestorsâlikeâtoâpurchaseâmunicipalâbondsâandânotesâbecauseâtheâinterestâisâoftenâbutânotâalwaysâexemptâfromâfederal,âstate,âandâcityâincomeâtaxes.âTheâtaxâexemp-tionâmeansâthatâtheâcommunityâcanâissueâmunicipalâbondsâatâlowerâcouponârates,âyetâstillâofferâaâhigherâafter-taxâyieldâthanâcorporateâbonds.
Whenâtheyâneedâtoâissueâbonds,âmunicipalâmanagersâfaceâtheâsameâratingâsystemâthatâcorporationsâface.âToâbeâmarketable,âoneâorâmoreâofâtheâmajorâratingâ agenciesâStandardâ&âPoorâs,âMoodyâs,âorâFitchâmustârateâ
theâbonds.âToâobtainâaâgoodârat-ing,âcommunitiesâmustâhaveâtheirâfiscalâhouseâinâorder,âwhichâmeansâadequateâcapacityâtoâraiseârevenuesâthroughâtaxes,âbalancedâbudgets,âmanageableâexistingâdebt,âstableâpopulation,âandâaâqualifiedâfinan-cialâteam.âInâaddition,âagenciesâcanâdowngradeâmunicipalâbondsâinâstatusâjustâasâtheyâdoâcorporateâbonds.âForâexample,âinâ2009,âinâtheâfaceâofâaâdecliningâlocalâeconomyâ
andâaâ$300âmillionâbudgetâdeficit,âMoodyâsâandâStandardâ&âPoorâsâloweredâDetroitâsâratingâtoâjunkâbondâstatus.
Municipalâmanagersâmustâdecideâwhetherâtoâissueâgeneral obligation bonds,âbackedâonlyâbyâtaxârevenues;ârev-enue bonds,âwhichâpayâinterestâfromâsomeârevenueâsourceâsuchâasâwaterâandâsewerâfees;âorâmortgage bonds,âsecuredâbyâbuildingsâorâotherâassets.âThenâthereâisâtheâmarketingâchallenge:âsewersâandâcityâstreetsâareânotâasâglamorousâcomparedâwithâmostâcorporateâassets.
Aâgoodâunderstandingâofâbondsâandâdebtâmarketsâisâaâmustâtoâbecomeâaâmunicipalâmanager,âwhetherâinâaâbigâcityâorâaâsmallâtown.âSalariesâforâmunicipalâmanagersâmayânotâequalâthoseâinâmuchâofâtheâcorporateâworld,âbutâmostâhaveâcomfortableâincomesâandâexcellentâbenefitâpack-ages.âTheâknowledge,âexperience,âandâpoliticalâcontactsâthatâtheseâmanagersâacquireâinâtheirâpositionsâcanâresultâinâlucrativeâopportunitiesâtoâmoveâtoâtheâprivateâsector,âespeciallyâtoâbanks,âinsuranceâcompanies,âconstructionâcompanies,âandâconsultingâfirmsâthatâdoâbusinessâwithâmunicipalâgovernments.
Municipal Manager
pUtting Finance tO WOrk