DEFINITION of 'Matilda Bond'
A bond denominated in the Australian dollar and issued on the Australian market by a foreign entity that seeks to raise capital from Australian investors. A Matilda Bond may attract demand from Australian investors who wish to diversify their security holdings without the attendant currency risk.
Better known as a "kangaroo bond."
BREAKING DOWN 'Matilda Bond'
Demand for Matilda bonds has risen substantially in recent years as corporate treasurers look to diversify their exposure. The strong Aussie dollar has also fueled demand for Matilda bonds from cash-rich investors in Asia, since most investors prefer to invest in assets denominated in strengthening currencies in order to boost returns.