First-Time International Bond Issuance—New Opportunities and Emerging Risks

By Anastasia Guscina, Guilherme Pedras, Gabriel Presciuttini

July 18, 2014

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Format: Chicago

Anastasia Guscina, Guilherme Pedras, and Gabriel Presciuttini. First-Time International Bond Issuance—New Opportunities and Emerging Risks, (USA: International Monetary Fund, 2014) accessed November 21, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

International bond issuance by debut issuers has risen in recent years. The uptick was a result of both demand and supply factors. The search for yield and demand for portfolio diversification have resulted in demand-driven easy financing conditions. At the same time, rising financing needs for many debut issuers, coupled with reduced access to concessional financing, relatively undeveloped domestic markets, and a favorable interest rate environment have made international bonds an attractive financing alternative for many countries. As bonds issued in the international markets are typically denominated in hard currencies, have large volumes and a bullet structure, exposure to exchange rate and refinancing risk has increased. Therefore, risk-mitigating policy actions are needed to prepare for redemption, support debt sustainability, and secure adequate debt management capacity.

Subject: Bonds, Currencies, Debt sustainability, Emerging and frontier financial markets, External debt, Financial institutions, Financial markets, International bonds, Money

Keywords: Bond issuance, Bond market, Bonds, Currencies, Debt manager, Debt relief, Debt sustainability, Debt sustainability exercise, Debt sustainability indicator, Debut issuer, Emerging and frontier financial markets, Exchange rate, External shock, First-time issuer, Foreign currency, Frontier markets, Global, International bonds, LICs, Market access, Public debt, Sub-Saharan Africa, WP

Publication Details

Pages:

40
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2014/127
Stock No:

WPIEA2014127
ISBN:

9781498390699
ISSN:

1018-5941

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