South Korea’s state-run Export-Import Bank of Korea (Korea Eximbank) said on June 21 that it raised 120 billion yen (US$1.09 billion or 1.21 trillion won) in samurai bonds. Samurai bonds are yen-denominated bonds issued by non-Japanese companies in Japan.
The Eximbank bumped up the offering scale from original 80 billion yen (US$725.62 million or 807.26 billion won) to 120 billion yen (US$1.09 billion or 1.21 trillion won) due to heated demand from sovereign funds and institutional investors beyond Japan. The figure was the largest-ever Asian debt offering for samurai bonds, according to the Eximbank.
An official from the Eximbank said, “As the mood of peace between North and South Korea is being created activities following summit meetings between the two Koreas and between North Korea and the United States, “Korea discount” has been reduced. Japanese investors seem to become favorable to South Korean debt after the summit meeting between South Korea, China and Japan last month.”
In a dual-tranche structure, 70 billion yen (US$634.92 million or 706.36 billion won) papers were issued in 1.5-year maturity at a coupon of 0.16 percent and 50 billion yen (US$453.51 million or 504.54 billion won) in three-year notes at 0.27 percent, which are the cheapest rates in samurai issues by Korean institutions.