The role of foreign bond issuance: The case of Australia

Jonathan Andrew Batten, Warren Hogan, Peter Szilagyi

Research output: Contribution to journalArticleResearchpeer-review

2 Citations (Scopus)

Abstract

We examined the recent development of the foreign bond?termed Kangaroo bond?market in Australia. Overwhelmingly, issuers in this market are of high credit quality and comprise sovereign, supranational and major international financial institutions. Local institutional investors have a preference for simple, fixed-rate pricing structures, with foreign issuers reliant upon converting their Australian dollar-denominated bond proceeds into the currency and coupon type of choice using cross-currency swaps. The Kangaroo bond issuers provide a natural counterparty to Australian residents issuing in foreign currency in offshore markets, where cross-currency swaps allow them to easily convert their proceeds into Australian dollars.
Original languageEnglish
Pages (from-to)36 - 50
Number of pages15
JournalAustralian Economic Review
Volume44
Issue number1
DOIs
Publication statusPublished - 2011
Externally publishedYes

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