Japan issues record-breaking foreign currency bonds this year.

VTV.vn - Japanese companies issued 25 trillion yen in foreign currency bonds in 11 months, surpassing the 2024 record thanks to a narrowing interest rate differential.

Banknotes of 10,000 yen and 100 USD denominations in Tokyo, Japan. (Photo: AFP/VNA)

Japanese companies issued 25 trillion yen ($160 billion) in foreign currency bonds between January and November, surpassing the full-year record set in 2024, thanks to narrowing interest rate differentials encouraging businesses to tap into the massive overseas debt market.

This figure also exceeds the 21 trillion yen in yen-denominated bonds issued during those 11 months, according to the LSEG report. This trend underscores how Japan's small corporate bond market, which is less than one-tenth the size of the US corporate bond market, is limiting the ability of Japanese companies to raise capital. Companies seeking funding for acquisitions and growth investments must look to other markets with larger investor bases.

Nippon Telegraph and Telephone's issuance of bonds totaling $11.25 billion and €5.5 billion ($6.4 billion) – equivalent to 2.6 trillion yen – in July through its subsidiary NTT Finance was the largest foreign currency bond issuance ever by a Japanese company. The debt was used to finance overseas data centers as well as to refinance loans from the telecommunications provider's agreement to privatize NTT Data Group.

Although NTT Finance has previously issued bonds in foreign currency, its recent issuance came with more detailed explanations of NTT's strategy and finances, driving demand up six or seven times compared to the USD-denominated bond issuance. The Bank of Japan's interest rate hike further fueled this trend.

With yields rising in Japan and trending downwards elsewhere, offering bonds overseas no longer seems expensive. Yields on 10-year government bonds rose by approximately 0.9 percentage points from the end of 2024 in Japan and fell by 0.4 percentage points in the US.

Japanese companies are also increasingly selling bonds that do not meet investment standards abroad.

In July, Nissan Motor, a struggling company, issued a total of 660 billion yen in US dollar and euro bonds, along with yen-denominated convertible bonds sold overseas. It is unusual for a company to issue both foreign currency bonds and convertible bonds simultaneously. Nissan will use the proceeds from the foreign currency bonds primarily to refinance existing debt and the convertible bonds to finance growth investments.

Chipmaker Kioxia Holdings, which has a BB+ rating, one notch below investment grade, issued more than 300 billion yen in foreign currency bonds in its first bond offering.

The issuance of speculative bonds with relatively high yields overseas reflects the small size of the Japanese market. While most bonds issued in the Japanese market have investment-grade ratings, approximately 10% to 20% of bonds issued in the US have ratings below that threshold.

In October 2025, Japan's Ministry of Economy , Trade and Industry established a research group on revitalizing the corporate bond market, focusing on debt rated BBB or lower. The research group will discuss steps such as expanding the supply of publicly offered bond investment funds.

Source: https://vtv.vn/nhat-ban-phat-hanh-trai-phieu-ngoai-te-pha-ky-luc-nam-100251210091321802.htm