It has been a mixed year for Japan with the country and its capital markets able to boast of significant achievements but also facing challenging obstacles. Overall, however, the tone remains positive. Big picture-wise, the Japanese economy continues to grow at a steady 2% a year as it continues to reap the benefits of years of painful restructuring of its corporate and banking sectors. The growth is expected to continue but acceleration is unlikely because of the country’s ¥834.4trn debt. This is a major concern and a brake on stronger growth...Read more
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The successful restructuring of the corporate sector was a key pillar in Japan’s economic recovery. But while growth has remained above 2% for the most part of this century, the country is still faced with structural and political challenges that could hinder its economic expansion. Han Nee Tay reports.
It has been a year of two halves for the Samurai bond market. Next to nothing in the first few months; boom-time after that. The market continues to feature the kind of enormous liquidity that dried up elsewhere in the summer credit crunch. And while the pricing on offer has widened, it still represents good value for borrowers. Atanas Dinov reports.
The Financial Instruments and Exchange Law, which changes the regulations governing the Japanese hedge fund industry, came into force in September. There is still considerable debate about what the implications of the law will be. It should be a boon to hedge fund managers but there are concerns that it will increase the regulatory burden. Hugo Cox reports.
The Japanese government is encouraging local governments to stand on their own feet, which means an upturn in municipal bond issuance is certain. And with plans to exempt foreigners from withholding tax, Japanese muni bonds are set to be the next big area of interest for foreign investors in the yen markets, writes Atanas Dinov.
Japan’s equity capital markets were forced to reinvent themselves over the last 12 months as markets stagnated and issuance evaporated. Investment banks saw a ¥8trn market cut in half and only a lucky few were able to save their year with a series of highly tailored and highly profitable structured trades. Govinda Finn reports.
Global securitisation has transformed from hero to zero with issuance levels going from exuberant to non-existent. Japan has also endured a market retreat with securitisation in the year to September at US$21bn, compared to a record $41bn last year. But despite the downturn Japan's isolationist spirit and cautious approach has seen it avoid the worst of the excesses seen elsewhere, writes Govinda Finn.
NikkoCiti smashed all records with the issuance of a ¥415bn joint Samurai and global bond in June at the peak of the Samurai fever before the global credit crisis struck. Since then, the firm had established itself as a force to reckon with by reopening the yen bond market in September with a ¥250bn global issue, writes Han Nee Tay.