Goldman Manages Japan Minus-Rate Bond as Swaps Lure Global Funds
- State-backed Japan firm sells its first negative-rate notes
- The sale ‘seems to be aimed at foreign investors:’ Barclays
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Goldman Sachs Group Inc. lead-managed a Japanese institution’s first sale of bonds with negative yields, amid rising demand from foreign investors who can profit from currency swaps.
State-backed Deposit Insurance Corp. of Japan issued 120 billion yen ($1.1 billion) of two-year notes with an effective yield of minus 0.124 percent and 100 billion yen of four-year debt at minus 0.084 percent earlier this month. The negative yields aren’t a disincentive for overseas investors: using cross-currency basis swaps, dollar-based holders of two-year Japanese debt are still able to get a yield that’s 78 basis points higher than similar-maturity U.S. Treasuries, according to Bloomberg calculations.