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The Romanian Municipal Bond Market and the International Financial Crisis



    () (Institute of National Economy, Romanian Academy)


    () (Petroleum and Gas University from Ploiesti,Faculty of Economics)


In Romania, the bond market was set up later, comparatively to the equity market. This market is in a development process, but the international financial crisis has affected even the interest of investors in bonds. The secondary municipal bond market is not a very liquid market because these securities are bought from the primary market and held in portfolios by investors because these bonds have a low risk. The issue of these bonds is correlated with the financial independence and the level of decentralization of the local public authorities. The issuance of these bonds is correlated with financial independence and decentralization level specific to local public authorities. Under crisis conditions, the volatility of this market is more significant, the increasing deficits of local budgets decreasing the interest of the middle-class in investing in such financial instruments.

Suggested Citation

  • Valentina Vasile & Mirela Matei, 2010. "The Romanian Municipal Bond Market and the International Financial Crisis," Romanian Journal of Economics, Institute of National Economy, vol. 30(1(39)), pages 110-126, June.
  • Handle: RePEc:ine:journl:v:1:y:2010:i:39:p:110-126

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    References listed on IDEAS

    1. Tatiana Mosteanu & Carmen Maria Lacatus, 2009. "The Issue Of Municipal Bonds, A Challenge For The Romanian Local Public Administrations," Annales Universitatis Apulensis Series Oeconomica, Faculty of Sciences, "1 Decembrie 1918" University, Alba Iulia, vol. 1(11), pages 1-47.
    2. Mirela MATEI, 2008. "Aspects Regarding The Development Of Bucharest Stock Exchange," Romanian Journal of Economics, Institute of National Economy, vol. 27(2(36)), pages 145-159, December.
    3. Tatiana Mosteanu & Carmen Maria Lacatus, 2008. "The Municipal Bonds – the Cause and the Effect of the Local Financial Decentralisation Growth. Romanian Case," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 9(9(526)), pages 51-60, September.
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    More about this item


    bonds; crisis; stock exchange; municipalities;

    JEL classification:

    • G01 - Financial Economics - - General - - - Financial Crises
    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage
    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures


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