Choice of currency in bond issuance and the international role of currencies

This paper investigates bond issuance of non-financial corporations in advanced economies during the period 1999-2003, attempting to understand motives for issuing in foreign currency, and determinants for the choice of currency. We consider the following influences on the currency choice when issuing foreign currency denominated debt: the microeconomic characteristics of the firm, the macroeconomic institutional environment and the financial particularities of the bond issue. We find that in addition to cost minimisation, hedging motives and the desire to establish an investor base influences the choice of currency. At the same time, market conventions and regulation also affect the choice.

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Year of publication:	2007
Authors:	Siegfried, Nikolaus ; Simeonova, Emilia ; Vespro, Cristina
Publisher:	Frankfurt a. M. : European Central Bank (ECB)
Subject:	Internationale Anleihe \| Währung \| Eurobond \| Euro \| Währungswettbewerb \| EU-Staaten \| Welt \| Bond issuance \| conditional logit \| Foreign currency denominated debt \| nested logit \| Panel logit

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Series:	ECB Working Paper ; 814
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Working Paper
Language:	English
Other identifiers:	547245572 [GVK] hdl:10419/153248 [Handle] RePEc:ecb:ecbwps:20070814 [RePEc]
Classification:	C25 - Discrete Regression and Qualitative Choice Models ; E44 - Financial Markets and the Macroeconomy ; F23 - Multinational Firms; International Business ; G32 - Financing Policy; Capital and Ownership Structure
Source:	EconStor

Persistent link: https://www.econbiz.de/10011604860