Citigroup to offer 100 billion yen in samurai bonds
Nikkei: Issuance is first aimed at retail investors since 2000
Updating to correct a mathematical error in an earlier version
SAN FRANCISCO (MarketWatch) -- Citigroup Inc. will issue as much as 100 billion yen ($940.6 million) in samurai bonds on July 1, its first such offering aimed at Japanese retail investors since 2000, according to a published report.
With interest rates low in Japan, Citigroup has determined that it can raise funds under favorable terms and that the yen-denominated bonds will attract interest from Japanese retail investors, business daily Nikkei said on its Web site in a report dated Tuesday.
Samurai are yen-denominated bonds issued by foreign borrowers in Japan. In the first three months of 2008, foreign companies raised nearly $5 billion, about 4.5 times the total amount in the first quarter of 2007, according to Thomson Financial.
Citigroup's planned samurai issuance is the first aimed at retail investors since its 50 billion yen offering in September 2000, Nikkei said. Citigroup offered a 270 billion yen samurai issue in June 2007, aimed at institutional investors.
Nikko Citigroup Ltd. will lead manage the three-year bonds, which will be marketed through Nikko Cordial Securities Inc. and other institutions, beginning Friday. The bonds are expected to generate a 2-3% annual yield, with a minimum unit costing 1 million yen, Nikkei said.
By comparison, the return on Japanese government bonds that mature in three years is around 1%.--------------0----------------0------------------0---------------------0
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