Partial Acquisition of Privately Placed Samurai Bonds Issued by Government of Turkey
Supporting Diversification of Turkey's Funding Sources and Vitalization of Samurai Bond Market
- Area: The Middle East
- Untied Loans
The Japan Bank for International Cooperation (JBIC; Governor: Akira Kondoh) acquired on December 7 a part of JPY60 billion yen-denominated bond issuance in the Japanese bond market (Samurai bonds*1
) by the Government of Turkey (GOT). Daiwa Securities Co., Ltd., Mizuho Securities Co., Ltd., and SMBC Nikko Securities Inc. participated as joint lead arrangers in the bond issuance.
This partial acquisition of Samurai bonds, which was approved under the JBIC's financing facility called "Guarantee and Acquisition toward Tokyo market Enhancement (GATE) *2
", follows similar support provided for Samurai bond issues by GOT in March 2011*3
, March 2012*4
, and September 2014.*5
This issuance of Samurai bonds without JBIC's guarantee was successful, due to the increased awareness of the GOT (issuer) bonds among investors participating in the Tokyo bond market after the successful issuances of Samurai bonds with guarantees from JBIC in the past. Such phased support for GOT in the issuance of Samurai bonds contributes to maintaining and increasing the presence of bonds issued by GOT in the Tokyo financial market. Furthermore, JBIC's support in encouraging foreign issuers to issue Samurai bonds in the Tokyo market is expected to provide broader investment opportunities for Japanese investors and stimulate the Samurai bond market.
Turkey advances large-scale projects such as infrastructure and urban development towards the year 2023 which will be the centennial foundation of the country. Under such circumstances, Turkey becomes increasingly more attractive to Japanese companies as an export market of plant facilities and equipment and a regional hub for overseas investment destination. Additionally, Turkish and Japanese companies are increasingly making joint investments in large scale infrastructure projects in third countries such as the Central Asia, the Caucasus, the Middle East, and North Africa. JBIC's continuing support for Samurai bond issuance by GOT is expected to contribute to stabilizing the Turkish economy, which will eventually lead to strengthening relations of trust between Japan and Turkey as well as spurring Japanese companies' business activities in a wide range of areas.
- JBIC will continue to support the issuance of Samurai bonds by foreign governments and government agencies in the Tokyo bond market, by utilizing the GATE financing facility.
- *1 Samurai bonds are yen-denominated bonds issued by a foreign government or company in the Tokyo bond market.
- *2 For details, please refer to the press release issued on April 15, 2010
- *3 For details, please refer to the press release issued on March 15, 2011
- *4 For details, please refer to the press release issued on March 13, 2012
- *5 For details, please refer to the press release issued on September 24, 2014