ABSTRACT
Economic conditions in Taiwan in the first half of the 1990s have generally been favorable for the development of the bond market. The main participants in Taiwan's bond market are the issuers, underwriters, dealers, and buyers. Currently Taiwan's bond market is dominated by government issuers. Bonds are issued not only by three levels of government but also by state-controlled banks and government corporate enterprises. The main buyers of bonds in Taiwan are the banks. The domestic bonds in Taiwan can be divided into three main types: government bonds and notes, corporate bonds, and financial debentures. Central government bonds are issued by the Central Bank of China as the issuing agent for the ministry of finance. Taiwan's primary and secondary dealers operate mainly on the over-the-counter (OTC) market. Most bond trading is on a wholesale basis and is handled on the telephone by market makers on a negotiated basis.
