A company issues bonds when it borrows money from many investors at once, in exchange for paying interest and repaying the principal on a fixed date. The process involves structuring the issuance, obtaining a rating if the market requires it, preparing the prospectus or relying on an exemption, placing the securities and appointing a paying agent.
Before you start: does issuing make sense?
A bond competes with bank credit. It usually pays off when the financing need is medium or long term, the amount justifies significant fixed costs and the company has predictable cash flows and a willingness to publish information periodically. In return, it diversifies its sources, can agree on repayment at maturity instead of installments and no longer depends on a single bank. If you need to review the mechanics of the instrument, start with what corporate bonds are.
The steps of a bond issuance
- Corporate decision and structuring. The competent body approves the issuance and sets the amount, term, fixed or floating coupon, amortization schedule, guarantees, financial covenants and representation of the holders. A structuring bank, a law firm and the auditor are involved.
- Credit rating. A registered agency assesses the ability to pay. It is common for placing with institutional investors or in regulated markets, and dispensable in many private placements.
- Prospectus or exemption. A public offering or admission to a regulated market requires a prospectus approved by the supervisor, in Spain the CNMV, under the Prospectus Regulation. There are exemptions: offering only to qualified investors, to fewer than 150 persons per Member State, securities of at least 100,000 euros per unit and, since June 5, 2026, offerings of up to 12 million euros. We explain it in what the CNMV prospectus is.
- Registration of the securities. Bonds are represented by book entries at the central depository or, if tokenized, in a distributed ledger maintained by an authorized entity.
- Placement. In a syndicated offering, one or more placement banks build the order book and set the price; in a private placement, the issuer and its advisor negotiate with a small group of investors.
- Paying agent and life of the bond. The paying agent calculates and pays coupons and amortizations. The issuer meets its information and covenant obligations and, if it decided to, applies for admission to trading.
Costs of issuing: what weighs more
| Concept | What it includes | Relative weight |
|---|---|---|
| Structuring and legal advice | Documentation, contracts, due diligence | High, especially in the first issuance |
| Placement | Bank fee on the amount placed | High for syndicated offerings |
| Rating | Initial fee and annual monitoring | Medium, optional depending on the market |
| Supervisor and market | Prospectus approval, admission | Low or medium |
| Registry, paying agent, audit | Registry maintenance, payments, periodic reporting | Recurring |
Most of these costs are fixed: they cost almost the same for a small issuance as for a large one. That is why, for years, the bond market remained reserved for large issuers.
Tokenized issuance as an alternative for mid-sized issuers
A tokenized bond remains a transferable security subject to MiFID II, and therefore falls outside MiCA (Article 2.4). What changes is the registry. In Spain, Article 8 of Ley 6/2023, developed by Real Decreto 814/2023, allows securities to be represented using distributed ledger technology, with an ERIR as the entity responsible for registration. URSUS-3 Capital, A.V. was the first authorized ERIR, in November 2024.
| Aspect | Traditional issuance | Tokenized issuance |
|---|---|---|
| Registry | Central depository | ERIR on distributed ledger |
| Payments and events | Chain of intermediaries | Automatable on the registry itself |
| Reasonable size | Large | Also medium-sized |
| Transfer | Regulated market or multilateral system | Bilateral registered in the ERIR; multilateral on DLT Pilot Regime infrastructures |
Combined with the prospectus exemption of up to 12 million euros, tokenization makes the operational side cheaper and makes a mid-sized issuance viable. It does not change the essentials: the issuer's credit quality, the need to find investors and the issuance documentation remain. The detail is in tokenization of debt and bonds in Spain and in how to issue a security token in Spain.
How to choose the route
A practical rule. If you are looking for a large amount and have a rating or can obtain one, the traditional market remains the natural route. If your need is below the exemption threshold, you have stable cash flows and an identifiable investor base, such as professional investors you already speak with or partners in your sector, tokenized issuance deserves serious analysis. And if what you need is short-term liquidity, you may not need a bond: a promissory note or a bank line may suffice.
And in Latin America
Each country has its own instrument and supervisor. In Argentina, the usual route for a company to borrow in the capital market is negotiable obligations, with a specific regime for SMEs; in Mexico, stock exchange certificates play an equivalent role. The logic of the steps is the same: structure, document, place and pay.
Related: Alternative Fixed Income Market (MARF).
Does your company have the size for a tokenized bond issuance? Take the issuance diagnostic (2 min) or request a proposal.
This content is informative and educational. It does not constitute legal, tax, or investment advice. Check the current version of each regulation in the BOE and on EUR-Lex.
HokenFi is a software and infrastructure provider; it does not provide regulated services (CASP, ESI, EAF, or ERIR). This article is informative and does not constitute financial or legal advice.
Frequently asked questions
How long does it take a company to issue bonds?
It depends mainly on two factors: whether a prospectus approved by the supervisor is required and whether a credit rating is requested. An exempt private placement, with simple documentation, can close in a few weeks. A public offering with a prospectus, rating and placing bank usually takes several months. The first issuance is always the slowest, because it forces you to organize financial and corporate information.
Is a credit rating mandatory to issue bonds?
Not as a general rule. Institutional investors and some markets ask for the rating, but many private placements are done without it, supported by the issuer's financial information and the agreed guarantees. It has an initial cost and an annual monitoring cost, so it is worth assessing whether the investors you are targeting require it before commissioning it.
What changes if the bond issuance is tokenized?
The registry changes, not the nature of the bond. In Spain, securities can be registered in a distributed ledger maintained by an ERIR under Ley 6/2023 and Real Decreto 814/2023, which simplifies payments and transfers. The bond remains subject to MiFID II and outside MiCA. Since 5 June 2026, offerings of up to 12 million euros are exempt from prospectus.
