Indian bond yields, OIS steady; U.S. cues eyed
* 10-yr yield seen in 7.65-70 pct range ahead of cbank review

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India corp bond yields up a shade, liquidity watched MUMBAI, May 24 (Reuters) – Indian corporate bond yields were mostly steady on Monday, rising by a basis point, as traders watched how liquidity pans out in the coming weeks and awaited news of a fresh bond auction for this week. Read more on Reuters via Yahoo! Philippines News

Watch Shane Bond being auctioned during the IPL 2010 Player Auction.

Afghanistan Plans Bill Trading, Bond Sales, Central Bank Says
March 16 (Bloomberg) — Afghanistan plans to allow trading in central bank bills and start selling longer-term government bonds in the coming year to diversify funding sources after receiving more than $30 billion of international assistance.

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India corp bond yields steady; supply fears persist
MUMBAI, March 9 (Reuters) – Indian corporate bond yields ended little changed on Tuesday, as persisting fears of being crowded out by government debt offset a drop in federal yields.

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Buffett’s ‘Dangerous Business’ Grips Bond Insurers (Update1)
Feb. 19 (Bloomberg) — Forewarned bankruptcies linked to infrastructure projects from Las Vegas to Harrisburg, Pennsylvania, may prove Warren Buffett ’s conclusion that insuring municipal bonds is a “dangerous business.”

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LSE launches retail bond market
LONDON (SHARECAST) – Some 33 years after the Jim Callaghan-led Labour government became an unlikely midwife to the concept of a ‘share owning democracy’ with its privatisation of a chunk of the government’s stake in BP , the London Stock Exchange (LSE) is hoping to convert a proportion of the British public to the appeal of owning bonds.

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Two More Active Bond ETFs Hit Markets, This Time from Grail
Michael Johnston submits: Grail Advisors, known in the ETF world as the issuer responsible for the first actively-managed ETF that allowed managers total discretion, announced today the launch of two actively-managed fixed income ETFs. The Grail McDonnell Intermediate Municipal Bond ETF and the Grail McDonnell Core Taxable Bond ETF began trading on the NYSE Arca Exchange on Friday, bringing the …

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India – progress and development is thy name! And the same stands true for the Indian economy, more so for the ‘bond market’. An innovation of the recent past, asset-backed securities have grown to be a pivotal part of the corporate debt market. Floating rate instruments, convertible bonds, step redemption bonds, zero coupon bonds – these and many more such instruments are today being acknowledged country-wide.

A decade back, banks like ICICI and IDBI began issuing step bonds. While those of the ICICI Bank paid a higher rate of interest, those of the IDBI allowed clients to pay the redemption amount in instalments after an initial holding period. In addition, the approach of maturity of ICICI step bonds clearly showed the benefits of bond issuance in India, while IDBI step bonds had two put and call options before maturity. All these have provided a range of securities that have helped in maintaining a sought-after risk return balance. Due to these corporate issuers, preference has changed from public issues to private placements.

Upon comparing the equity market with the bond market for the past decade, we find that the equity market saw a drop of almost 14% of GDP – slumping from 42% in 1993-94 to 28.6% in 2000-01. Au contraire, the Government of India bonds (GOI bonds) enjoyed an increase of about 8% of GDP – from 28% to 36.7% – in the same period. As a result, there appeared a reduction in liquidity in the equity market and a substantial increase in liquidity in the Indian bond market.

But don’t get stupefied with the impressive statistics of the GOI bonds. Every coin has two sides. Similarly, there are some drawbacks to the Indian bond market also. The GOI bond market doesn’t use trade as an exchange and features a bilateral negotiation between dealers. The market hence, lacked price time priority. To top it, bilateral negotiations imposed credit risk on participants narrowing the market with a homogeneous credit risk.

The Indian bond market, however, is today at par with some of the leading markets of Asia like Korea. The grapevine is that in a few years, the Indian bond market will be counted as a renowned market of the world.

We feel proud to recognise the bond market of India better than that of China. And this is definitely an evidence of Indian economy’s quick progression. Moreover, the Indian bond market is profitable to almost anyone and everyone. The new business houses especially find the Indian market profitable from an operational point of view. That is pretty obvious as they have been able to initiate business in a very short time span and generate capital easily.

LIQUIDITY OF INDIAN DEBT MARKET

The liquidity of the Indian debt market has helped both the market as well as the various companies operating in it. But, for the market to sustain itself, and that too in an international level requires capital. Luckily, the Indian debt market has been able to attract enough companies.

POTENTIAL OF FIXED INCOME MARKET IN INDIA

Every market has its highs and lows. For the Indian market, the fixed income market is counted in the former. As stated before, the Indian economy is considered better than the Chinese economy, and the fixed income market is one amongst many reasons for this. Experts expect the bond market in India to grow manifold and become one of the biggest in the world in perhaps another decade or so.

SECONDARY INDIA BOND MARKET

One of the best secondary bond markets of Asia is that of India. It has a high amount of liquidity. The market is an establishment of sixteen primary dealers who underwrite the sales of the debt of the Government of India and deal with India’s apex bank, the Reserve Bank of India, directly. As icing on the cake, some bonds in the secondary market have maturity period of as long as thirty years!