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Volumes of Samurai bonds — yen-denominated bonds issued by non-Japanese entities — hit a 15-year high in 2011, and could be 20 percent higher in 2012, a Tokyo-based analyst told CNBC.com.
Samurai bonds issuance reached $25.3 billion this year, the highest volume since 1996 when the Japanese bond market was deregulated.
In total, 39 deals came to the market in 2011, six more than in 2010 when issuance equaled $22.9 billion.
Issuers included European banks such as Rabobank, BNP Paribas and Barclays , while JP Morgan Chase became the first US bank to issue a samurai since Lehman Brothers collapsed in 2008.
Akane Enatsu, a Barclays Capital senior credit analyst, said Japan’s cash-rich investor base will entice foreign entities to continue tapping the market in 2012.
“In Japan, banks are pretty much the major investors for bonds, and they are relatively healthy compared to US or European banks ,” she said. “Even though the Japanese market is not that attractive for issuers, because of the currency swap rate, they will still come because they know money is available.”
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