Japan

A stream of SSA borrowers entered the primary bond market this week in both euros and dollars. Dual tranche deals were popular as borrowers sought to take size without paying heavy new issue premiums.

Finland is lining up a three year dollar benchmark for Wednesday, following a stream of issuance on Tuesday that highlighted the strength of the dollar market.

Bank Nederlandse Gemeenten, FMO, Japan Bank for International Cooperation and the Province of Quebec all hit screens on Monday for forthcoming dollar deals, with bankers remarking that the SSA market could be set for another hectic week.

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Mizuho Financial Group has raised $4bn from a triple-tranche bond to meet its total loss-absorbing capacity (TLAC) requirements. All three Japanese global systemically important banks have now issued such notes this year and market participants said investors and issuers are warming up to the product.

The Asia DCM market opened to a slew of issuance on Tuesday with Singapore duo Olam International and PSA International, Korea National Oil Corp and Japanese lender Mizuho Financial Group looking to tie up their respective dollar transactions.

The Inter-American Development Bank made an early claim on Monday for a spot in this week’s dollar issuance, in what its leads said was a move to ensure it did not add its name to a growing trend for SSA deal clashes.

Monetary policy and declining oil prices caused unusual currency correlations in recent quarters, say bank analysts, but changes in sentiment around developed market currencies and the prospects for US inflation look set to send those measures back toward normal levels.

The Bank of Japan’s decision to cut interest rates below zero has already had an impact on the ability of bankers to generate cross-border deals. But the wider ramifications of the move may be reflected in the domestic bond market. Matthew Thomas reports.

Japan’s top-rated credits are used to getting a captive audience from international investors, cheap spreads at home and their choice of funding markets. But the global volatility that has defined the financial markets over the last few years has made things tough even for these well placed issuers. GlobalCapital sat down with some of the most highly-regarded issuers in Japan, as well as respected senior bankers, to discuss how these issuers can best approach the debt markets.

Since Shinzo Abe was elected as prime minister in December 2012, ‘Abenomics’ has been a buzzword for international and domestic investors alike. Abe’s determination to turn the Japanese economy around, combined with the aggressive style of his hand-picked central bank governor, has brought unprecedented attention to Japan in a time of global volatility. That makes the job of communicating the strengths of the Japanese economy to investors all the more important. GlobalCapital sat down with Eiko Kimata, director for debt management and JGB investor relations at Japan’s Ministry of Finance, on March 11 to find out how investors have reacted to the central bank’s recent move into negative interest rates, how international investors are viewing the potential of the Japanese economy, and how the Ministry of Finance can best approach a tricky funding environment.

The Bank of Japan has proven itself to be among the most aggressive central banks in the world over the last few years. But the central bank went a step further in February, pushing interest rates below zero. Investors and issuers are still struggling to figure out just what the policy means for them. Matthew Thomas reports.