Understanding the Yankee Market

Understanding the Yankee Market

The term "Yankee market" is used to refer to the stock market in the United States, primarily by non-U.S. residents. This term is derived from the slang "Yankee," which is sometimes playfully, though derogatorily, used to refer to U.S. citizens. This article delves into the concept of the Yankee market, Yankee bonds, and the emerging trend of reverse Yankee bonds.


The "Yankee market" is a colloquial expression used to refer to the stock market in the United States, primarily by non-U.S. residents. This term is derived from the slang "Yankee," which is sometimes playfully, though derogatorily, used to refer to U.S. citizens. The term originated as business slang but has since gained widespread acceptance. In a similar vein, other financial markets are referred to with slang terms, such as the "bulldog market" for the U.K. market and the "samurai market" for Japan.

Yankee Bonds

Yankee bonds are debt securities issued by foreign banks or companies but traded in the United States and denominated in U.S. dollars. These bonds hold a significant place in international finance.

Key Characteristics:

  • Tranches: Yankee bonds are typically issued in tranches, which are individual portions of a larger debt offering or financing arrangement. Tranches can differ in terms of risk levels, interest rates, and maturities.
  • Offering Size: These bond offerings can be substantial, often reaching up to $1 billion.
  • Regulations: The issuance of Yankee bonds is subject to stringent U.S. regulations, leading to a protracted approval process. It may take over three months for a Yankee bond issue to gain approval, during which a debt-rating agency assesses the issuer's creditworthiness.

Reverse Yankee Market

A reverse Yankee market refers to U.S. companies participating in the Euro bond market, which has witnessed substantial growth, reaching a staggering €380 billion. This practice has become increasingly common, demonstrating the interconnectedness of global finance.

Noteworthy Deals

In 2017, General Electric (GE) issued an €8 billion bond that received €22 billion in orders, showcasing strong demand for long-dated issuance from U.S. borrowers. This success led to a trend in reverse Yankee deals, with other American corporations like Pfizer and Coca-Cola following suit. Coca-Cola held the record for the largest reverse Yankee deal in 2015, raising €8.5 billion across five tranches, but the GE sale surpassed it and ranked as the fourth-largest euro corporate bond sale ever. The success of these deals has increased the interest of major U.S. businesses in pursuing reverse Yankee deals.

U.S. Corporations Attracted to the European Market

The Financial Times reported that companies like Allergan and Baxter International scheduled investor meetings in Europe as part of their plans for bond sales in 2017. This exemplified the growing attraction of the European market to U.S. corporations.

Borrowing Trends in Europe

According to Bloomberg, U.S. companies significantly increased their borrowing in Europe in 2017, borrowing 57 billion euros compared to 42 billion euros during the same period in 2016. This surge in borrowing activity highlighted the allure of the European financial landscape for American businesses.

Notable Participants

Several heavyweight U.S. companies engaged in reverse Yankee deals during this period. Some of the noteworthy participants included:

  • Kimberly Clark
  • GM Financial
  • Nestle
  • AT&T
  • Apple
  • IBM
  • Kellogg
  • Procter & Gamble
  • Netflix
  • Aramark
  • AMC Entertainment
  • Levi Strauss
  • American Honda


The Yankee market, rooted in financial slang, offers a unique perspective on global financial markets. Yankee bonds, a crucial component of international finance, have specific characteristics and regulations. The reverse Yankee market highlights the interconnectedness of the global financial system. American corporations now seek funding in Europe, resulting in significant success and a changing landscape of cross-border financial transactions. This trend signifies the evolving dynamics of international finance and the adaptability of corporations to explore new opportunities in global finance.

Yankee Market
Yankee Bonds
Reverse Yankee Market