| Stefano Ghersi | ||||||
In Japan the economy continues to sink towards recession, banks struggle under the weight of bad debts and companies edge towards painful restructuring. Yet the primary market for yen-denominated bonds, both samurai and Euroyen, is still in rude health. International issuers, corporates and governments, are turning to these markets as an important source of funds, attracted by ultra-low interest rates, strong demand from retail buyers in Japan, and the low risk of the yen strengthening against major currencies.
Although the size of issues reflects a general trend in the international bond markets for smaller deals, the yen market is still capable of making headlines. This year saw the largest-ever yen issue from a non-Japanese corporate - a ¥325 billion ($2.7 billion) two-tranche issue from France Telecom. The joint-largest single-tranche sovereign samurai issue also appeared - a ¥200 billion deal for the Federative Republic of Brazil.