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Eurobond market

As noted, the coupon rate is the interest rate the issuer agrees to pay each year. The coupon rate is used to determine the annual coupon payment which can be delivered to the bondholder once per year or in two or more equal installments. As noted, for bonds issued in European bond markets and the Eurobond markets, coupon payments are made annually. Conversely, in the United Kingdom, United States, and Japan, the usual practice is for the issuer to pay the coupon in two semiannual installments. An important exception is structured products (e.g., asset-backed securities) which often deliver cash flows more frequently (e.g., quarterly, monthly). [Pg.8]

However, the economic rationale for its continned expansion remains intact. It might take longer than some of the original optimistic pundits predicted. But over time, the Eurobond market will develop the depth and liquidity to match the needs of both investors and issuers. [Pg.168]

Peter Gallant, The Eurobond Market (London Woodhead-Faulkner Ltd., 1988), p. 54. [Pg.168]

For the first few years of its life, the Eurobond market was largely the preserve of the dollar. Why were the early issues in dollars rather than in European currencies For a start, the money was there to be invested. We have already mentioned the prudent Russians, who had good reason to keep their hard-earned dollars off-shore. The stock of dollars outside the United States was further built up by the country s dominant position in the post-war global economy. [Pg.169]

On top of this, US regulations (specifically Reg Q ) limited the interest rate that could be paid on domestic depository accounts. So holders of overseas dollars were in no hurry to repatriate them. Borrowing in European currencies was made difficult by a web of exchange controls and other limitations hard to imagine for today s market participants. Indeed, the gradual relaxation of these controls allowed the Eurobond market to expand to other currencies. [Pg.169]

For a good description of this and other aspects of the Eurobond market s sometimes colorful early days, see Ian Kerr, A History of the Eurobond Market (London Euromoney Publications, 1984). [Pg.170]

The Eurobond market changed significantly with the launch of European Monetary Union, which added a new impetus to its development. [Pg.173]

Much as history is conventionally divided between the BC and AD eras, the development of the Eurobond market can be split between pre-euro and post-euro periods. [Pg.173]

A principal reason for the shortage of nonfinancial borrowers in the Eurobond market is the strength of the European banking system. Banks, rather than the bond market, have long been the major providers of credit in Europe. This stands in sharp contrast to the United States, where institntional investors are much more prominent. As can be seen in Exhibit 6.3, banks contribnte 60% to 80% of national financial... [Pg.174]

Although the Eurobond market has changed hugely over time, in some ways it remains close to its roots. The way bonds are traded is one of these. Most transactions are still done over the telephone between market professionals. Salespeople take orders from institutional investors and relay them to the traders. [Pg.184]

The relative liquidity of the Eurobond market compared to the United States is a hotly debated question. The general impression is that the Eurobond market is less liquid than the US corporate sector. The average transaction size is greater in the United States, reflecting the market s larger size ( 1,679 billion versus 651 billion) and the concentrated structure of the investor base. Other obvious liquidity metrics, such as bid/offer spreads are hard to track consistently. What is true is that secondary market trading conventions have converged over time. [Pg.186]

So far in this section we have discussed the secondary market— transactions involving outstanding issues. Let s now turn to the primary sector, through which bond issues are originated and priced. The new issue sector provides the lifeblood of the Eurobond market by supplying new issues to replace those that have matured or been called. Also, bond issues become less liquid as time passes, so greater origination has a direct beneficial effect on the secondary market, as well. [Pg.191]

The debate around bond prospectus covenant packages, in terms of the relatively poor protection they offer bondholders, has been one of the hardy perennials of the Eurobond market. The primary reason for the lack of strong covenants is the extremely diffuse investor base, which makes it difficult for bondholders to form a consensus on what covenants are truly desirable. [Pg.192]

The sterling-denominated Eurobond market has an active long-dated (30 years or more) sector, and this has led to two important differences in documentation compared to the Euro market. Firstly, to provide additional comfort to investors in long maturity paper, the bonds are often secured by charges on the issuers assets. It is worth noting in this connection that the common terminology can be inconsistent. Market... [Pg.193]


See other pages where Eurobond market is mentioned: [Pg.167]    [Pg.167]    [Pg.168]    [Pg.169]    [Pg.169]    [Pg.170]    [Pg.170]    [Pg.170]    [Pg.170]    [Pg.171]    [Pg.171]    [Pg.171]    [Pg.171]    [Pg.173]    [Pg.173]    [Pg.173]    [Pg.173]    [Pg.174]    [Pg.174]    [Pg.174]    [Pg.175]    [Pg.176]    [Pg.176]    [Pg.178]    [Pg.179]    [Pg.181]    [Pg.182]    [Pg.183]    [Pg.184]    [Pg.185]    [Pg.187]    [Pg.189]    [Pg.191]    [Pg.193]    [Pg.194]    [Pg.195]    [Pg.197]   
See also in sourсe #XX -- [ Pg.8 , Pg.59 , Pg.167 ]




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