How international bonds are issued

The main methods of international bond issuance are as follows:

(1) Public offering. This is a bond issued to the public at large and can be publicly traded on a stock exchange. The issuance of public Bonds must be rated by an internationally recognized credit rating agency. Borrowers are required to disclose their circumstances to the public. Each time a borrower issues a bond, its credit rating must be re-determined.

(2) Private placement. It refers to bonds issued privately to a limited number of investors. The amount of this kind of bond issued is relatively short and the term is short, and it cannot be listed and traded publicly. However, private placement bonds are flexible and generally do not require ratings from credit rating agencies, nor do issuers require the issuer to disclose their situation to the public, and the issuance procedures are relatively simple.

In addition, the distribution methods can also be divided into:

(1) Direct distribution. The issuer itself will issue bonds, handle all the issuance procedures, make pre-issuance preparations, sell bonds directly to investors, and handle the remaining bonds itself. The issuer can also accept applications from investors within a specified period before issuing bonds, print the bonds according to the number of applications, and issue them directly, which can prevent a surplus of bonds.

(2) Indirect distribution. The issuer entrusts an intermediary to issue bonds on its behalf, which is divided into entrusted raising and off-take raising. Entrusted raising means entrusting a sales group to sell bonds, and bonds that cannot be fully sold will be returned to the issuer for processing. The off-take raising is promoted by the ** Group, and the bonds that cannot be sold out are bought by the off-takers. In the international bond market, bonds are generally issued through offtake.