Advanced English Dialogue for Business – Agreement among under writers

Listen to a Business English Dialogue About Agreement among under writers

Christian: Claire, have you heard of the term “Agreement Among Underwriters” in finance?

Claire: No, what is it?

Christian: It’s an agreement between investment banks who underwrite a securities offering, outlining their responsibilities and how they’ll share the risks and profits.

Claire: Oh, so it’s like a contract that sets out the terms for underwriting a securities offering?

Christian: Exactly, it helps ensure that the underwriters work together smoothly to bring the offering to market.

Claire: Are there any specific clauses or provisions typically included in these agreements?

Christian: Yes, they usually specify the underwriters’ obligations, the allocation of shares, and how any unsold securities will be distributed.

Claire: I see. So, it’s important for underwriters to have a clear understanding of their roles and responsibilities?

Christian: Absolutely, it helps prevent misunderstandings and ensures that the offering is managed efficiently.

Claire: Can you explain how the underwriters share the risks and profits?

Christian: Typically, each underwriter agrees to purchase a certain portion of the securities and shares in both the risks and profits based on their allocation.

Claire: Got it. So, they’re all in it together when it comes to managing the risks and rewards?

Christian: Exactly, it’s a collaborative effort to ensure the success of the securities offering.

Claire: Thanks for explaining, Christian. It’s interesting to learn about the inner workings of underwriting agreements.

Christian: No problem, Claire. Understanding these agreements is crucial for anyone involved in the securities industry.