BackExim Bank raises $17 million by selling samurai bonds
The money raised from the bonds will be used to fund Indian exports to Sri Lanka and for financing railway projects in that country
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Mumbai: Export Import Bank of India (Exim Bank) on Wednesday said it has raised 20 billion yen ($17 million) by issuing samurai bonds in Japan at 0.97% under the Japan Bank for International Cooperation’s (JBIC) guarantee and acquisition toward Tokyo market enhancement (GATE) facility.
A samurai bond is a yen-denominated bond issued in Tokyo by non-Japanese companies, and is subject to Japanese regulations.
The money raised from the bonds will be used to fund Indian exports to Sri Lanka and for financing railway projects in that country, Exim Bank said.
JBIC will guarantee the principal and part of the interest of the bonds, Exim Bank said, adding that this was the second issuance by the lender in the samurai bond market after the inaugural JBIC-guaranteed bond in 2011.
“Exim Bank achieved the tightest spread and the lowest coupon, the first sub-1%, in the history of the GATE facility. The previous record for the lowest coupon was held by the bonds issued by the government of Turkey (1.05%)," the bank said in a statement.
Daiwa Securities Group Inc., Mitsubishi UFJ Financial Group Inc., Morgan Stanley Securities, Mizuho Securities Co. Ltd and SMBC Nikko Securities Inc. were the arrangers to the issue, Exim bank said.
“The renewed optimism on the economic outlook for India and also the bold quantitative easing announced by the Bank of Japan have increased the appetite for the Indian paper in the Japanese market. With the above issue, Exim Bank has been able to diversify its source of overseas funding," the bank said.
Before this yen issuance, the bank had raised money in Australian dollars, Mexican peso, Singaporean dollars, South African rand, Swiss francs, Turkish lira and US dollars.
Foreign currency resources constituted about 46% of Exim’s borrowings on 31 March, said the bank whose primary aim is to finance India’s international trade and investment.
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