The Growth Of The Corporate Bond Market

1890 Words8 Pages
In the last few years, a number of things have changed: • There has been a significant increase in new corporate bond issues (and other hybrid securities) that can be accessed by sophisticated retail investors, including growth of issues by unrated companies. • Ways for retail investors to access corporate bonds have continued to develop. • Regulatory changes to reduce impediments to retail investment in corporate bonds are slowly occurring. Ultimately, the maturation of the corporate bond market depends upon three key factors: underlying demand of investors; potential supply by corporate issuers; regulatory and other impediments to connecting investors and issuers. Access has long been a problem for individual investors with an…show more content…
While there have been significant developments in the regulatory sphere to assist the development of the retail corporate bond market, there remains some ambiguity about the treatment of SMSFs and their trustees as sophisticated investors, and their consequent ability to participate in wholesale market offerings. This ambiguity warrants resolution given the increasing importance of that sector and the increasing relevance of fixed interest investments for funds with ageing members. Apple bond ➢ Apple has priced a $2.25 billion Kangaroo bond issue, smashing the record for the largest corporate bond issue in Australia. ➢ The deal is also the largest ever Kangaroo corporate bond. The Kangaroo bond is a term for bonds sold by foreign entities into the Australian dollar market. ➢ The deal is seen as a major endorsement of Australia 's corporate bond market, which has at times struggled to lure the world 's largest companies ➢ The company said the proceeds were intended for "general corporate purposes" including share buybacks, dividend payments and to fund working capital, capital expenditure, acquisitions and debt repayments SABmiller ➢ Global beer giant SABMiller has completed its first Australian corporate bond issue, raising $700 million of
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