Australia Debt Market
CHARLES STURT UNIVERSITY
Student ID: 11514207
Student Name: Zoydulla Numanov
Task: The Australian Corporate and Government debt market
FIN 530 Assignement 2
Lecturer: Ruhina Karim
26.08.2013 * Executive summary
The purpose of this report is to review corporate and government debt market of Australia. The report illustrates effect of GFC to Australian corporate and government debt markets and how Australia managed debt market during that period. The main finding are that Australian economy was not effected in that extend as rest of the world. Australian banks were concentrated in domestic market rather than investing offshore. Also government provided guaranty which supported debt market and saved it from default.
Furthermore, it examines the shortage of supply in debt market. There are only a few offers of corporate debt available for retail investors through ASX. Analyze shows that the most of Australian debt issuers are rated as low risk investment companies which make issued securities high liquid and increases demand among investors who seeks for low risk and fixed income. It also analyses pricing, interest rate and guaranty that different bonds offer. Government bond are the closest security to risk free investment and yields are the lowest compliance with risk.
The report analyses different sources (such as RBA, ASB S&P, ASX and other financial institutions), related to the debt market of Australia and provides overview of current situation with expectations. It also demonstrates the role of foreign investors in debt market of Australia with recent changes.
Table of Contents *
Introduction 4
Corporate debt market 5
Government debt Market 8
Conclusions 13
Appendix 13
References 13
1. Introduction
The Debt market plays crucial role in economy of every country as it is one of the main sources of finance for both Corporate and Government. Furthermore, an organization tries to maintain optimal debt
Student ID: 11514207
Student Name: Zoydulla Numanov
Task: The Australian Corporate and Government debt market
FIN 530 Assignement 2
Lecturer: Ruhina Karim
26.08.2013 * Executive summary
The purpose of this report is to review corporate and government debt market of Australia. The report illustrates effect of GFC to Australian corporate and government debt markets and how Australia managed debt market during that period. The main finding are that Australian economy was not effected in that extend as rest of the world. Australian banks were concentrated in domestic market rather than investing offshore. Also government provided guaranty which supported debt market and saved it from default.
Furthermore, it examines the shortage of supply in debt market. There are only a few offers of corporate debt available for retail investors through ASX. Analyze shows that the most of Australian debt issuers are rated as low risk investment companies which make issued securities high liquid and increases demand among investors who seeks for low risk and fixed income. It also analyses pricing, interest rate and guaranty that different bonds offer. Government bond are the closest security to risk free investment and yields are the lowest compliance with risk.
The report analyses different sources (such as RBA, ASB S&P, ASX and other financial institutions), related to the debt market of Australia and provides overview of current situation with expectations. It also demonstrates the role of foreign investors in debt market of Australia with recent changes.
Table of Contents *
Introduction 4
Corporate debt market 5
Government debt Market 8
Conclusions 13
Appendix 13
References 13
1. Introduction
The Debt market plays crucial role in economy of every country as it is one of the main sources of finance for both Corporate and Government. Furthermore, an organization tries to maintain optimal debt
References: ASB. (2013, 8 18). Australian Bureau of Statistics. Retrieved 8 20, 2013, from http://www.abs.gov.au: http://www.abs.gov.au Dale, M. (2011). The Australian Bond Market: A Profile for Defensive Investors. Sydney: PIMCO Australia Pty Ltd. Davis, K. (2012). Australian Corporate Bonds. Australia: National Australia Bank Limited. Debelle, G. (2013). Some recent (and not so recent) trends in Australian debt. Sydney: KangaNews DCM Summit 2013. James, M., & John, E. (1980). THE WEIGHTED AVERAGE COST OF CAPITAL, PERFECT CAPITAL MARKETS, AND PROJECT LIFE: A CLARIFICATION. Journal of Financial & Quantitative Analysis, 719-730. Lancaster, D., & Dowling, S. (2011). The Australian Semi-government. NA: RBA. O 'Brien, G., Cunningham, R., Musgrave, A., Keeley, J., & Ricthie, D. (2012). Interest Rate Securities. NA: ASX Limited. Phillips, V. (2012). Financial institutions, instruments & markets. North Ryde NSW: McGraw-Hill Australia Pty Ltd. RBA. (2013, 8 7). In chart pack. Retrieved 8 18, 2013, from http://www.rba.gov.au: http://www.rba.gov.au/chart-pack/bond-issuance.html S&P. (2013, 8 18). S&P Dow Jones Indices. Retrieved 8 18, 2013, from http://au.spindices.com: http://au.spindices.com/indices/fixed-income/sp-asx-corporate-bond-index