A changing interest rate environment and post-financial crisis regulatory shifts are among the catalysts prompting institutional investors to increase their use of fixed income exchange traded funds.

The first U.S. fixed income ETF study by independent research firm Greenwich Associates and sponsored by BlackRock’s (NYSE: BLK) iShares unit, the world’s largest ETF issuer, shows 85% of current bond ETF users have employed such funds for at least two years while about two-thirds have boosted their usage of fixed income ETFs since 2011.

Bond ETFs have bucked the trend of departures from equity-based funds. U.S. bond ETFs have raked in $16 billion this month as of Feb. 21, the Wall Street Journal reported, citing TrimTabs Investment Research. That puts on bond ETFs for the biggest monthly gain since the iShares iBoxx $ Investment Grade Corporate Bond ETF (NYSEArca: LQD) debuted in 2002 and is nearly double the previous record monthly inflow of $8.4 billion in May 2012, the Journal reported. [Bond ETFs: The New Black]

Greenwich Associates surveyed “110 U.S.-based institutional investors about their use and perceptions of fixed-income exchange-traded funds. The respondent base included 42 investment managers (firms managing assets to specific investment strategies/guidelines), 29 registered investment advisers, 21 institutional funds (pensions, endowments and foundations), and 18 insurance companies. The sample population comprised 59 current active users of fixed-income ETFs and 51 non-users in order to determine current and future use of fixed-income ETFs by active users, as well as the current reasons non-users don’t actively use fixed-income ETFs and their expected interest,” according to the consulting firm.

Liquidity and ease of use are the primary reasons institutional investors have increasingly embraced bond ETFs, according to iShares.  Soaring assets across bond ETFs has helped elevate liquidity. Bond ETFs had a combined $246 billion in assets at the end of last year, according to iShares.

Still, some market participants have persistently raised concerns about potential liquidity issues in some areas of the bond market, particularly high yield and leveraged loans. Goldman Sachs recently implied that after being on the receiving end of inflows for 88 straight weeks, bank loan ETFs and mutual funds could be vulnerable to a reversal of fortune. [Goldman Cautious on Leveraged Loans]

Most of the institutions surveyed (65%) have made changes to their fixed income portfolios, according to the Greenwich survey. Those portfolio alternations are expected to continue increase and potentially increase over the next 12 months, according to the study.