DETERMINANTS OF CORPORATE BOND MARKET SIZE: EVIDENCE FROM ASIAN COUNTRIES AND IMPLICATIONS FOR VIETNAM

Tóm tắt

After the Asian crisis of 1997, developing countries started paying more attention to the role of
corporate bond markets in the economy. Having a strong local currency corporate bond market is
expected to help Asian economies like Vietnam better allocate funds into profitable investments and
increase resilience of the domestic financial sector to external shocks. The study attempts to explore
economic, financial, and institutional developmental factors that contribute to the growth of the
size of corporate bond markets by using the data set from ten Asian economies (China; Hong Kong,
Indonesia; Japan; Korea; Malaysia; the Philippines; Singapore; Thailand; and Vietnam). The
empirical findings by generalized least squares model show that the level of economic development
as shown by GDP per capita is one of the most important factors in the development of corporate
bond markets. Other significant factors are the availability of domestic bank credit and a thriving
market for government bonds. Better creditor rights protection also contributes to the growth of
corporate bond markets. Furthermore, the study also intends to provide recommendations to further
develop the Vietnamese corporate bond market