Characteristics
of International Bond Market
Characteristics of
international bond market may be explained in terms of scope of bond market,
international currencies, selling of bonds, and raising large capital.
1. Scope of Bond Market
In
international bond markets, Finance can be raised by the companies, Government
and institutions. It is important to note that only a well reputable with
strong financial rated companies can issue bonds in the bond markets. Therefore
international bond market is not an option for small companies.
2. International Currency
In
international bond market, Bonds are issued at international currency. The most
common currencies for bond market are USD & Euro. Even some bonds market
are named on the currency i.e. Eurobond market.
3. Selling of Bonds
Initially bonds are sold by international
bank to different financial institution in different countries. In simple word,
these bonds are offered internationally to different investor in different countries.
These bonds are underwritten by an international syndicate.
4. Raising Large Capital
International
bond markets are usually used by the company for arranging huge or big amount
of capital. For low amount of capital bank loan are preferred, because bond
issuing requires a lot of technical skills and fulfillment of legal
formalities.
