BNP Paribas Markets First Offering of Samurai Bond Since 2011

BNP Paribas SA (BNP), France’s largest bank, started marketing its first sale of Samurai bonds since March 2011.

The lender told investors it plans to price the three-year notes to yield 15 to 20 basis points more than the yen swap rate, and debt due in five years at a spread of 20 to 25, according to a person familiar with the matter. The terms will be set as early as Sept. 6, said the person, asking not to be identified as the information is private.

The offering follows a 65.3 billion yen ($663 million) yen-bond sale on June 20 by Credit Agricole SA (ACA), another French lender. The average spread on Samurais, or yen-denominated notes sold in Japan by overseas borrowers, dropped to the lowest since November 2007 at 50 basis points last month, according to Bank of America Merrill Lynch index data.

BNP Paribas also plans to sell three-year floating-rate notes yielding 25 to 30 basis points more than the three-month London interbank offered rate for the yen, and five-year bonds paying 30 to 35 more than the benchmark, the person said. A basis point is 0.01 percentage point.

The Paris-based bank last sold Samurais in March 2011, when it raised 62 billion yen in a two-part sale, including 47.8 billion yen of five-year 1.06 percent notes at a 30 basis point spread, according to data compiled by Bloomberg. The yield premium soared to as high as 387.3 basis points in January 2012 amid Europe’s sovereign debt crisis, before declining to 41.7 on Aug. 30, the data show.

Daiwa Securities Group Inc., Mizuho Financial Group Inc. (8411) and SMBC Nikko Securities Inc. are helping the lender’s local unit with the offering, the person said.

To contact the reporter on this story: Yusuke Miyazawa in Tokyo at ymiyazawa3@bloomberg.net

To contact the editor responsible for this story: Katrina Nicholas at knicholas2@bloomberg.net

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