Mizuho, HSBC, Daiwa to lead Malaysia’s samurai bond issuance

Alfian Z.M. Tahir Alfian Z.M. Tahir Updated 7 years ago · Published on 18 Jan 2019 1:45PM · 0 Comments

Finance Minister Lim Guan Eng (left) with Japanese ambassador Dr Makio Miyagawa at the announcement of the lead arrangers for Malaysia’s samurai bonds in Putrajaya today. Malaysia will have access to cheaper funds in Tokyo via the bonds. – The Malaysian Insight pic by Nazir Sufari, January 18, 2019.

MALAYSIA has appointed Mizuho Bank (M) Bhd, HSBC Bank Malaysia Bhd and Daiwa Markets Singapore Ltd as lead arrangers for the proposed 10-year ¥200 billion (RM7.6 billion) samurai bond issue, said Finance Minister Lim Guan Eng.

The three were picked from a shortlist of six out of 27 proposals received by November 2 last year, Lim said.

The appointments will ensure the country enjoys the lowest possible cost of funds, he said.

“The final decision was made after the ministry was convinced that these are the three best institutions which have the experience, expertise to ensure that we will enjoy the lowest possible cost of funds.

“As part of government-to-government arrangement, the Japan Bank of International Cooperation (JBIC) will be guaranteeing the bond.

“This will allow the government to pay all-inclusive indication coupon rates of less than 0.65% per annum,” Lim said after handing over the appointment letters to the Japanese ambassador Dr Makio Miyagawa.

The bond is expected to be raised in the next few months.

“I have been directly told by the prime minister to handle the entire bond issuance and lead a Malaysian delegation to Tokyo in February.

“The issuance of this samurai bond is the testament of confidence the Japanese government has in our leadership.”

Lim said the last samurai-bond arrangements between Malaysia and Japan can be traced back to 1989.

Makio later said he was pleased with the commitment shown by Lim and Dr Mahathir Mohamad.

“We appreciate the effort showed by Malaysian government led by Dr Mahathir Mohamad and Lim Guan Eng. Both have worked very hard and Dr Mahathir has shown transparency and we appreciate this.”

Last year, Lim said Japan offered to guarantee ¥200 billion of samurai bond issuance with a 10-year tenure.

A samurai bond is a yen-denominated bond issued in Tokyo by a non-Japanese company or entity and subject to Japanese regulations.

Samurai bonds give issuers the ability to access investment capital available in Japan, according to finance education website Investopedia. – January 18, 2019.

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