Foreign bonds are bonds issued by foreign entities (usually governments and parastatals) in local currency. They are foreign from the point of view of the local bond market. For example, a bond issued by a Swiss utility in Local Country (LC), denominated in LCC, is a foreign bond.
A number of countries at time issue bonds denominated in USD (US dollars) in the United States; these are foreign bonds (also called Yankee bonds) to US investors in them. Another example is a foreign country issue of bonds in Japan denominated in yen (JPY) (also called Samurai bonds). If a country issues bonds in the United Kingdom denominated in sterling / pounds (GBP), it is a foreign bond (in this case called Bulldog bonds). Foreign bonds are also called traditional international bonds.
Foreign bond issues are usually arranged by the investment banks of the country in which they are issued or investment banks that have an international presence with which the issuing government has a relationship. These bonds are issued in large denominations and are taken up mainly by the retirement funds, insurance companies and unit trusts.