[9.24 Financial Terms of the Day] "Underwriting" 1. The procedure by which an underwriter brings a new security issue to the investing public in an offering. In such a case, the underwriter will guarantee a certain price for a certain number of securities to the party that is issuing the security (in exchange for a fee). Thus, the issuer is secure that they will raise a certain minimum from the issue, while the underwriter bears the risk of the issue. 2. The process of insuring someone or something. 3. The process by which a lender decides whether a potential creditor is creditworthy and should receive a loan. (from InvestorWords)
Posted on: Tue, 24 Sep 2013 19:42:52 +0000
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