Corporate Bond Market: International Experience and Russian Practice

The corporate bond market development is integral to increase the resilience of the Russian economy to external shocks and to build a new growth model in terms of sanctions. The purpose of the article is to analyze the current state of the Russian corporate bond market and to develop proposals for accelerating its further development considering the international experience. The proposals are based on a study of the legal base for the functioning of the international bond market, as well as modern technologies and tools that have proven to be effective in practice. As part of a comparative analysis, a hypothetical-deductive research method has been used. The author has proposed: to develop and adopt independent federal law “On Corporate Bonds”; to amend and supplement the Russian legislation on the protection of the rights of investors who purchase corporate bonds; to make trial (debut) issues in the Russian stock market for bonds denominated in foreign currencies (for example, in RMB); to expand the line of bond types, etc. It has been concluded that, despite the unfavorable external and internal conditions, there is a steady increase in the number of issuers and corporate bonds in circulation in Russia. Active bond issue in the Russian financial market in the near future will happen not only in the corporate, but also in the public segment. It will require more active involvement of individuals in purchasing government and corporate bonds as investors. Various types of institutional investors competing with banks will also be attracted. Corporate bond issue can ease the financial burden of banks and companies that have problems with refinancing their external debts. It can also help to solve the problem of financing of the Russian companies that have focused on obtaining various bank loans in order to implement their business plans. This will help to increase the supply of temporarily free monetary resources, to reduce their cost and more efficiently transform savings into investments.

1. Schumpeter J.A. The theory of economic development: An inquiry into profits, capital, credit, interest and the business cycle. Cambridge, MA: Harvard University Press; 1934. 255 p.

2. Guriev S. Myths of economics. Misconceptions and stereotypes disseminated by mass media and politicians. Мoscow: Маnn, Ivanov i Ferber; 2014. 320 p. (In Russ.).

3. Dubinin S.К. Financialization of economic growth and the Russian national financial system. Finansy: teoriya i praktika = Finance: Theory and Practice. 2017;21(4):6–21. (In Russ.).

4. Golovnin М. Yu., Lykova L.N., Bukina I.S. The reaction of monetary-credit and budget-taxation policy of Russia on the challenges of globalization. Finansy: teoriya i praktika = Finance: Theory and Practice. 2017;21(5):6–21. (In Russ.).

5. Sokolova Т.V.Analysis of factors affecting the development of the market for corporate and government ruble bonds. Upravlenie korporativnymi finansami. 2015;(5):294–307. (In Russ.).

6. Gorokhovskaya О., Кlypina О. Comparative analysis of sources of debt financing. Rynok tsennykh bumag. 2004;278(23):86–88. (In Russ.).

7. Galenskaya К.V., Теplova Т.V. Bonds or bank loans: The choice of companies and the reaction of investors in the Russian stock market. Upravlencheskii uchet i finansy = Management Accounting and Finance Journal. 2016;(3):172–197. (In Russ.).

8. Johnston R.B. Economics of the Euro-Market: History, theory and policy. New York: Palgrave Macmillan; 1982. 334 p.

9. O’Malley C. Bonds without borders: A history of the Eurobond market. Chichester: John Wiley & Sons Ltd.; 2014. 288 p.

10. Balyuk I.A., Bich M.G., Zvonova E.A. et al. The impact of globalization on the formation of the Russian financial market. Мoscow: Knorus; 2018. (In Russ.).

11. Alekseeva I.A., Makarova E.V. Russian market of corporate bonds: Trends and development prospects. Izvestiya Baikal’skogo gosudarstvennogo universiteta = Bulletin of Baikal State University. 2017;27(3):389–400. (In Russ.).

12. Chaikovskaya Е. Red orange, or To make it in 24 hours. Cbonds Review. 2015;(4):52–55. (In Russ.).

13. Кyrova Е.V. Stimulating the development of the Russian securities market. Nauchnoe obozrenie: teoriya i praktika = Science Review: Theory and Practice. 2015;(9):220–222. (In Russ.).

14. Brealey R., Myers S. Principles of corporate finance. Transl. from Eng. Мoscow: Olymp-Business; 2008. 1008 p. (In Russ.).

15. Аbramova М.А., Коvaleva N.А., Lavrushin О.I., Rubtsov B.B., Tsyganov A.A. The mid-term trends in the Russian financial market development: Expert opinion. Ekonomika. Nalogi. Pravo = Economics, Taxes & Law. 2016;9(4):6–11. (In Russ.).

16. Siluanov А.G. Objectives of financial policy of the Russian Federation in the medium term. Vestnik Finansovogo universiteta = Bulletin of the Financial university. 2017;21(3):50–56. (In Russ.).

17. Andreev V.P. Yuan -denominated bonds as an alternative source of borrowings. Den’gi i kredit = Russian Journal of Money and Finance. 2017;(5):28–31. (In Russ.).

18. Bartholomew H. Bond e-trading shake-out gathers pace. International Financing Review. 10 August, 2015. URL: http://www.ifre.com/bond-e-trading-shake-out-gathers-pace/21211616.fullarticle (accessed on 11.08.2018).

19. Wilson R.S., Fabozzi F.J. Corporate bonds: Structure and analysis. Transl. from Eng. Мoscow: Аlpina Business Books; 2005. 446 p. (In Russ.).

20. Zvonova E.A., Ershov M.V., Kuznetsov A.V. et al. Reforming the global financial architecture and the Russian financial market. Мoscow: RuScience; 2016. 430 p. (In Russ.).

21. Аndrianova L.N., Semenkova Е.V. Strategic development of the Russian financial market: Initiatives of the megaregulator. Ekonomika. Nalogi. Pravo = Economics, Taxes & Law. 2016;9(4):12–20. (In Russ.).