tailieunhanh - Corporate bond markets in Asia

Since the 1997 Asian financial crisis, bond market development has become a high priority for Asian policymakers. The development of local currency bond markets has often been seen as a way to avoid crisis, with these markets helping reduce potential currency and maturity mismatches in the economy. Indeed, several Asian economies have succeeded in developing fairly active primary and secondary markets in domestic government bonds. In recent years, policymakers in many Asian economies have started to turn their attention to local currency non-government (“corporate”) bond markets. They recognise that a robust financial system requires multiple channels of financing, in which banks and other types of investor compete for borrowers. As. | Jacob Gyntelberg Guonan Ma Eli M Remolona 852 2878-7145 852 2878-7015 852 2878-7150 Corporate bond markets in Asia1 Corporate bond markets in Asia differ widely in size. Some primary markets have opened up to foreign issuers while others have relied on quasigovernment issuers. Secondary markets often suffer from illiquidity due in varying degrees to narrow investor bases inadequate microstructures and a lack of timely information about issuers. JEL classification G140 G180 M400 O160. Since the 1997 Asian financial crisis bond market development has become a high priority for Asian policymakers. The development of local currency bond markets has often been seen as a way to avoid crisis with these markets helping reduce potential currency and maturity mismatches in the economy. Indeed several Asian economies have succeeded in developing fairly active primary and secondary markets in domestic government bonds. In recent years policymakers in many Asian economies have started to turn their attention to local currency non-government corporate bond markets. They recognise that a robust financial system requires multiple channels of financing in which banks and other types of investor compete for borrowers. As the Asian financial crisis itself demonstrated short-term credit markets are prone to creditor runs and a corporate bond market can provide an economy with an important source of long-term While the primary markets for corporate bonds in Asia have grown significantly the growth in some cases seems to have been driven largely by quasi-government issuers or issuers with some form of credit guarantee. These markets may have developed in this way because investors have had little access to the kind of information that would allow them to adequately evaluate 1 The views expressed in this article are those of the authors and do not necessarily reflect those of the BIS. We thank Claudio Borio .