What does eurobond mean?
A eurobond is a debt security issued in a currency different from that of the country or market in which it is issued. For example, a bond denominated in US dollars but offered for sale in London or Singapore qualifies as a eurobond. Despite the name, the word predates the euro currency itself: the "euro-" element refers to the instrument's origins in the postwar European offshore capital markets, particularly the market in Eurodollars that flourished in London during the 1960s. Eurobonds are typically issued by multinational corporations, banks, and governments seeking access to a broad pool of international investors, and they are usually underwritten by an international syndicate rather than confined to a single domestic market. Because they fall outside any single national regulator's direct oversight, they offer issuers flexibility and often favourable tax treatment. In everyday usage the term appears almost exclusively in financial journalism, investment prospectuses, and market commentary.
nounA bond issued in a currency other than that of the country or market in which it is issued, typically traded internationally outside the jurisdiction of the currency's home country. Eurobonds are commonly used by corporations and governments to raise capital from international investors.
- A bond issued and traded in a currency other than that of the country where it is issued, usually underwritten by an international syndicate.
"The company issued a dollar-denominated eurobond to attract investors across Europe and Asia."
"Investors flocked to the newly issued eurobond, drawn by its attractive yield and strong credit rating."
"The sovereign eurobond offering was oversubscribed within hours of hitting the market."
Regular plural; used when referring to multiple issues or the asset class collectively.
"Emerging-market governments returned to the eurobond markets after several years away."
Despite the name, most eurobonds have nothing to do with the euro — they're simply bonds sold 'outside' their home currency, a label dating back to before the euro even existed.
Reviewed by Deb Chak, Editor. AI-assisted content curated by RJS Tech Solutions LLP.
Etymology of eurobond
The term eurobond emerged in the 1960s from the parallel vocabulary of the Euromarkets, notably "Eurodollar," which described US dollars held and lent outside the United States, largely through London banks. The "euro-" prefix in these coinages referred to Europe as the hub of this offshore trading activity, long before the single European currency was introduced in 1999. The first widely recognized eurobond issue was arranged in 1963 by the Italian state motorway company Autostrade, denominated in dollars and issued in Europe. Related terms sharing this prefix include eurocurrency, Eurodollar, and eurocommercial paper.
How eurobond is actually used
Eurobond is a technical term used mainly in finance and investment contexts; register is formal/professional. The term is capitalized by some publishers ("Eurobond") but lowercased is common. Note that a eurobond may or may not be denominated in euros.
Easily confused with eurobond
A eurobond is not a bond denominated in euros — despite the name, the prefix refers to its European offshore origins, and eurobonds can be issued in any major currency.