A Yankee bond is typically issued by which type of entity?

A Yankee bond is a type of bond that is issued in the United States by a foreign entity, which can be a foreign bank or corporation, and is denominated in U.S. dollars. This kind of bond allows foreign issuers to tap into the substantial U.S. capital markets and appeal to U.S. investors looking for investments in their local currency. By issuing Yankee bonds, foreign entities can diversify their funding sources and potentially achieve lower borrowing costs compared to their home country markets.

The characterization of Yankee bonds emphasizes their unique role in facilitating cross-border investment and capital flow, making them an attractive option for foreign institutions seeking access to U.S. investors. This is why the option focusing on foreign banks or corporations being the issuers of Yankee bonds is indeed the correct choice.