The prospect of Bond Market: Bangladesh perspective

Abstract

Bonds for Bangladesh are issued by Marchant Banks. In a country's economic development, the bond market acts as a buffer to equity markets. Through the issue of different types of bonds, particularly corporate bonds, the bond market can provide long-term finance to issuers. The current study has revealed the prospects for Bangladesh's corporate bond market in this respect. Bangladesh's bond market is hindered by a number of obstacles. Bond markets are currently in their infancy. A shortage of long-term debt instruments is responsible for this phenomenon. In this case, there is no reliable benchmark for bonds or debentures with long maturity dates. There is no liquidity on the market and no movement. By paying a relatively high rate of interest on the risk free national savings scheme, though interest has been reduced lately, it slows the growth of the economy. Moreover, the insurance process of bonds is burdensome and costly, which inhibits the emergence of a competitive market for bonds. Lastly, a suitable investor education must be provided simultaneously with the expansion of the investor base. Bond market reform is recommended.