The European corporate bond market posted significant gains in 1999, although it should be taken into account that temporary or exceptional factors may have been partly responsible for this. However, this trend has continued in 2000. The rising number of companies with relatively low ratings shows that it has become easier for firms to tap the capital market.
Indeed, the integration and deepening of the capital markets are particularly beneficial to smaller companies in need of venture capital. The newly created euro-denominated bond market is better able to absorb very large issues than the individual bond markets of the euro’s predecessor currencies.