Corporate bond market: The new liquidity trap

The liquidity-starved corporate bond market desperately needs to find a post-regulation equilibrium. Banks just can’t commit capital to market-making. So the smarter investors are looking at ways of delivering it themselves

The corporate bond market has a problem. In August that problem was masked by a record $120 billion of primary issuance worldwide during the month. The problem is not the amount of paper being issued – at least, not yet – it is that in its short trip from issuer to buyer these are virtually the only bonds in the market that are going anywhere.

 
When Euromoney sat down with the global head of DCM at a large bank earlier in the year there was only one thing on his mind.

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