International Finance Discussion Papers (IFDP)
May 2024
Corporate Bond Issuance Over Financial Stress Episodes: A Global Perspective
Valentina Bruno, Michele Dathan, Yuriy Kitsul
Abstract:
We use a merged global data set of security-level corporate bond issuance and firm-level financial statement data to show that, in contrast to earlier periods of financial stress, during the COVID pandemic nonfinancial firms around the world were more likely to issue bonds, driven by a boom in local-currency-denominated issuance. We observe a distinct cross-regional difference in the characteristics of issuing firms, finding that in advanced economies issuance during COVID was driven by less risky firms, as predicted by existing theories; in emerging markets, only issuance of U.S. dollar denominated bonds came from larger or less risky firms.
Keywords: COVID, corporate bonds, crises, issuance
DOI: https://doi.org/10.17016/IFDP.2024.1390
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