Details

Title

Determinants of Interest Rates on Corporate Bonds of Mining Enterprises

Journal title

Archives of Mining Sciences

Yearbook

2017

Numer

No 3

Divisions of PAS

Nauki o Ziemi

Abstract

<jats:title>Abstract</jats:title><jats:p>This article is devoted to the determinants of interest rates on corporate bonds of mining enterprises. The study includes a comparison between the cost of foreign capital as resulting from the issue of debt instruments in different sectors of the economy in relation to the mining industry. The article also depicts the correlation between the rating scores published by the three largest rating agencies: S&amp;P, Moody's, and Fitch. The test was based on simple statistical methods. The analysis performed indicated that there is a dependency between the factors listed and the amount of interest rates on corporate bonds of global mining enterprises. Most significant factors include the rating level and the period for which the given series of bonds was issued. Additionally, it is not without significance whether the given bond has additional options. Pursuant to the obtained results, is should be recognized that in order to reduce the interest rate on bonds, mining enterprises should pay particular attention to the rating and attempt to include additional options in issued bonds. Such additional options may comprise, for example, an ability to exchange bonds to shares or raw materials.</jats:p>

Publisher

Committee of Mining PAS

Date

2017

Identifier

ISSN 0860-7001

DOI

10.1515/amsc-2017-0045

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