A bond is a debt obligation that exists in the form of a security. Through the issuance of bonds, issuers raise capital for a certain period of time and pay interest on it to investors.

Bonds can be secured when they finance a certain asset. The collateralization of this asset ensures that investors can reclaim at least a portion of their capital invested in bonds if the issuer defaults on payments.

In the Kyrgyz Republic, the bond market is primarily represented by bonds issued by entities in the industry and trade sector. Another significant sector that relies on bond financing is the country’s banking industry.

Kyrgyz issuers issue only the most basic types of bonds – those guaranteeing the payment of the principal amount. More complex bonds, such as structured instruments and asset-linked bonds (also known as asset-backed notes/bonds or portfolio-linked instruments), are only offered by foreign issuers.