This document summarizes the international bond market. It defines international bonds as bonds issued in a currency other than that of the investor or broker, including eurobonds issued in a foreign currency and foreign bonds issued by a foreign government or corporation. International bonds are further classified as euro bonds denominated in a currency but sold internationally, foreign bonds offered by a foreign borrower domestically, and global bonds issued and traded outside the currency's home country. The document also lists some key features and types of international bonds such as corporate bonds, government bonds, zero-coupon bonds, convertible bonds, and floating rate notes.

1. INTERNATIONAL BOND
MARKET
Presented By:
Name: Venkatkrishna Kukkala
Roll No: 113 Div: B
Subject: International Finance

2. Meaning of International Bond Market
• The bond market is a financial market where
participants buy and sell debt securities , usually in
the form of bonds.
• A bond issued in a country or currency other than that
of the investor or broker. They include Eurobonds,
which are issued in a foreign currency, foreign bonds,
which are issued by a foreign government or
corporation in the domestic market, and global bonds,
which are issued in both domestic and international
markets.

3. INTERNATIONAL BOND IS FURTHER CLASSIFIED
IN THREE TYPES
• Euro Bond : A Eurobond issue is one
denominated in a particular currency but sold to
investors in national capital markets other than
the country that issued the denominating
currency.
• Foreign Bond : A foreign bond is one offered by a
foreign borrower to the investors in a national
capital market and denominated in the nation’s
currency. Example: A German MNC issuing
dollar-denominated bonds to U.S. investors

4. • Global Bond: It is a bond issued and traded
outside the country where a currency is
denominated. This type of bond is issued by a
non-European company, but sells in a European
country or any other foreign market. For
example, a U.S. corporation can issue a bond in
Europe. These bonds are sold in various
maturities and credit qualities.

5. FEATURES OF INTERNATIONAL BOND
• It is a debt market.
• It is a fund raising market.
• Fixed income instrument.
• Issued in foreign currency.
• It channelizing savings.

6. TYPES OF BONDS
Corporate Bond
• A corporate bond is a bond issue by a corporation. It
is a bond that a corporation issues to raise money
effectively in order to expand its business.
• The term is usually applied to longer-term debt
instruments, generally with a maturity date falling at
least a year after their issue date. (The term
"commercial paper" is sometimes used for
instruments with a shorter maturity.)

7. Government Bond
• A government bond is a bond issued by a national
government, generally promising to pay a certain
amount (the face value) on a certain date, as well as
periodic interest payments.
• Government bonds are usually denominated in the
country's own currency. Bonds issued by national
governments in foreign currencies are normally
referred to as sovereign bonds, although the term
"sovereign bond" may also refer to bonds issued in a
country's own currency.

8. Zero-Coupon Bonds
• This is a type of bond that makes no coupon
payments but instead is issued at a considerable
discount to par value. For example, lets say a
zero-coupon bond with a $1,000 par value and 10
years to maturity is trading at $600; you'd be
paying $600 today for a bond that will be worth
$1,000 in 10 years.
• The issue price of Zero Coupon Bonds is
inversely related to their maturity period, i.e.
longer the maturity period lesser would be the
issue price and vice-versa. These types of bonds
are also known as Deep Discount Bonds.

9. Convertible Bonds
• The holder of a convertible bond has the option to
convert the bond into equity (in the same value as of
the bond) of the issuing firm (borrowing firm) on pre-
specified terms.
• Convertible bonds may be fully or partly convertible.
For the part of the convertible bond which is
redeemed, the investor receives equity shares and the
non-converted part remains as a bond.

10. Floating Rate Notes
• Floating Rate Notes are bonds in which interest rate
depends on the interest rate prevailing in the market.
• The interest rate paid to the bondholder at regular
intervals comprises of the interest rate prevailing in
the market and ‘spread’, which is a rate that is fixed
when the prices of the bond are being fixed and it
remains constant till the maturity period of the bond

11. THANK YOU