Astana International Exchange (“AIX”, “Exchange”) is pleased to announce the launch of a new instrument - Commercial Papers. The relevant changes have been introduced to the AIX Markets Listings Rules, Delovoy Kazakhstan reports.
Commercial paper is a commonly used type of unsecured, short-term debt instrument issued by companies with proven creditworthiness and typically used for financing of the issuer’s short-term working capital needs (payroll, accounts payable, inventories, other operating expenses related to core activities of the issuer).
“AIX provides the local business community with yet another quick and cost-effective way of raising working capital. When compared to other sources like bank loans and loans from other financial institutions, commercial papers can provide more funding at a lower interest rate. It is a flexible financial tool which can easily be adjusted to the needs of issuers” Renat Bekturov, CEO of AIX
Commercial paper may be offered to professional (accredited) investors in any denomination. Given that offers are directed at Accredited Investors, it will be sold in lots of at least US$100,000. Other corporates, financial institutions, high net worth individuals, and money market funds are usually buyers of commercial paper.
Commercial paper is usually issued at a discount from par value and reflects prevailing market interest rates. Maturity on commercial paper may last several days, and range no longer than 365 days.