scholarly journals The Growing Importance of the Economic Role of the Corporate Bond Market

2021 ◽  
Vol 20 (4) ◽  
pp. 5-37
Author(s):  
Attila Bécsi ◽  
Gergely Bognár ◽  
Máté Lóga
Keyword(s):  
Negative Impact ◽  
Bank Lending ◽  
Bond Market ◽  
Bank Loans ◽  
Corporate Bond ◽  
Corporate Bond Market ◽  
Economic Role ◽  
Wide Range ◽  
Liability Structure

The role of corporate bonds has expanded globally in the past decade, as they are an ideal financial instrument both for diversifying the liability structure of issuing companies and managing investors’ portfolios. An adequately developed, liquid corporate bond market has a beneficial effect on the functioning and transparency of the market mechanisms of the economy and can also strengthen the crisis resilience of the financial system. Several studies have shown that – in addition to the normal functioning of companies – the issue of corporate financing is also important in crisis management, as uncertainty during a crisis has a negative impact on the liquidity of bank lending, limiting companies’ funding options. In such a situation, it is therefore vital that companies can also rely on other forms of financing. Recognising this in the aftermath of the 2008–2009 economic crisis, central banks in a number of countries launched bond purchase programmes in order to start supporting the expansion of the corporate bond market. Thanks to the Bond Funding for Growth Scheme (BFGS) of the Magyar Nemzeti Bank (the Central Bank of Hungary, MNB), the Hungarian corporate bond market now offers a realistic financing alternative to bank loans for a wide range of companies.

scholarly journals Law, Politics, and Financial Development: The Great Reversal of the U.K. Corporate Debt Market

2013 ◽  
Vol 73 (3) ◽  
pp. 810-846 ◽  
Author(s):  
Christopher Coyle ◽  
John D. Turner
Keyword(s):  
Twentieth Century ◽  
Financial Development ◽  
Bond Market ◽  
Corporate Bond ◽  
Late Nineteenth Century ◽  
Corporate Bond Market ◽  
Debt Market ◽  
Late Nineteenth ◽  
Over Time

This article examines the role of creditor protection in the development of the U.K. corporate bond market. This market grew rapidly in the late nineteenth century, but in the twentieth century it experienced a reversal, albeit with a short-lived post-1945 renaissance. Such was the extent of the reversal that the market from the 1970s onwards was smaller than it had been in 1870. We find that law does not explain the variation in the size of this market over time. Alternatively, our evidence suggests that inflation and taxation policies were major drivers of this market in the post-1945 era.

scholarly journals Corporate Bond Market: International Experience and Russian Practice

2019 ◽  
Vol 23 (2) ◽  
pp. 74-83
Author(s):  
I. A. Balyuk
Keyword(s):  
Financial Burden ◽  
Corporate Bonds ◽  
International Experience ◽  
Bond Market ◽  
Bank Loans ◽  
Corporate Bond ◽  
Steady Increase ◽  
Bond Issue ◽  
Corporate Bond Market ◽  
Active Involvement

The corporate bond market development is integral to increase the resilience of the Russian economy to external shocks and to build a new growth model in terms of sanctions. The purpose of the article is to analyze the current state of the Russian corporate bond market and to develop proposals for accelerating its further development considering the international experience. The proposals are based on a study of the legal base for the functioning of the international bond market, as well as modern technologies and tools that have proven to be effective in practice. As part of a comparative analysis, a hypothetical-deductive research method has been used. The author has proposed: to develop and adopt independent federal law “On Corporate Bonds”; to amend and supplement the Russian legislation on the protection of the rights of investors who purchase corporate bonds; to make trial (debut) issues in the Russian stock market for bonds denominated in foreign currencies (for example, in RMB); to expand the line of bond types, etc. It has been concluded that, despite the unfavorable external and internal conditions, there is a steady increase in the number of issuers and corporate bonds in circulation in Russia. Active bond issue in the Russian financial market in the near future will happen not only in the corporate, but also in the public segment. It will require more active involvement of individuals in purchasing government and corporate bonds as investors. Various types of institutional investors competing with banks will also be attracted. Corporate bond issue can ease the financial burden of banks and companies that have problems with refinancing their external debts. It can also help to solve the problem of financing of the Russian companies that have focused on obtaining various bank loans in order to implement their business plans. This will help to increase the supply of temporarily free monetary resources, to reduce their cost and more efficiently transform savings into investments.

The Macroeconomic Uncertainty Premium in the Corporate Bond Market

2020 ◽  
pp. 1-26 ◽  
Author(s):  
Turan G. Bali ◽  
Avanidhar Subrahmanyam ◽  
Quan Wen
Keyword(s):  
Cross Section ◽  
Bond Market ◽  
Corporate Bond ◽  
Economic Uncertainty ◽  
Corporate Bond Market ◽  
Macroeconomic Risk ◽  
Macroeconomic Uncertainty ◽  
Retail Investors ◽  
Investment Grade

Abstract We examine the role of macroeconomic uncertainty in the cross section of corporate bonds and find a significant uncertainty premium for both investment-grade (IG) (0.40% per month) and non-investment-grade (NIG) (0.81% per month) bonds. The economic-uncertainty premium declines as we progressively remove downgraded bonds, indicating that the premium represents an increase in required returns for bonds with higher credit and macroeconomic risk. The economic-uncertainty premia vary across equities and bonds in a manner consistent with the heterogeneous risk-aversion levels of dominant players in equities (retail investors) versus bonds (institutional investors).

scholarly journals Developing the Corporate Bond market- International Experience and Lessons for Vietnam Companies

2021 ◽  
Vol 9 (2) ◽  
Author(s):  
Nguyen Duy Thinh ◽  
Vu Ngoc Xuan
Keyword(s):  
Commercial Banks ◽  
Business Performance ◽  
Negative Impact ◽  
Bond Market ◽  
Middle Income Country ◽  
Corporate Bond ◽  
Middle Income ◽  
Corporate Bond Market ◽  
The World

Vietnam is in the process of developing into a middle-income country in the world. The widespread epidemic of covid-19 has had a negative impact on most Vietnam enterprises. However, the Vietnamese government's success in disease control has contributed to the recovery of business performance and efficiency. Vietnamese enterprises used to mobilize capital mainly through banking channels. In recent times, bonds are an important long-term capital mobilization tool for businesses, helping businesses reduce their dependence on commercial banks. This article mentions the development of the Vietnamese corporate bond market based on the experiences of several countries around the world.

Momentum in the European Corporate Bond Market: The Role of Bond-Specific Returns

2017 ◽  
Vol 27 (3) ◽  
pp. 54-70 ◽  
Author(s):  
Florian Barth ◽  
Hendrik Scholz ◽  
Matthias Stegmeier
Keyword(s):  
Bond Market ◽  
Corporate Bond ◽  
Corporate Bond Market

FINANSIRANjE PREDUZEĆA EMISIJOM KORPORATIVNIH OBVEZNICA

2021 ◽  
Author(s):  
Jasmina Labudović Stanković ◽  
Keyword(s):  
Financial Market ◽  
Corporate Bonds ◽  
Developed Countries ◽  
Bond Market ◽  
Secondary Market ◽  
Bank Loans ◽  
Corporate Bond ◽  
Corporate Sector ◽  
Corporate Bond Market ◽  
Bond Issues

The corporate bond market contributes to the development of the financial market, its infrastructure, and affects economic growth. In developed countries, corporate bond issuance is a very common way of borrowing by the corporate sector. In developing countries, this method of borrowing is used "shyly" because companies most often turn to banks for help. In addition, the inflow of FDI in these countries contributes to meeting the financial needs of the corporate sector, thus reducing the need for bond issues. The paper compares borrowing by issuing corporate bonds and bank loans, explains the forms of issue of these securities, rating bonds, the secondary market of corporate bonds and briefly presents the picture of the corporate bonds market of Republic of Serbia.

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