The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site.

All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.

Deal insider: Nomura spots Euroyen opening


Issuer: Fannie Mae
Amount: ¥100 billion
Maturity: 3 years 6 months
Coupon: 2%
Launched: May 14
Lead managers: Nomura, Merrill Lynch

Quite a few mouths stood agape when Federal National Mortgage Association, better known as Fannie Mae, re-opened the international Euroyen market in mid-May. Not least because international investors bought a bond that offered only a 2% coupon - the lowest ever for a global issue.

The deal was driven by technical conditions which not everyone was in a position to spot - they combined a mixture of swap arbitrage, a subtle shift in sentiment among international investors towards yen, the need for existing investors to switch out of Japanese government bonds (JGBs), and the desirability of creating a new benchmark, the last having been issued by the World Bank in November 1994.

Nomura had the idea, which partly stemmed from a long position in short-dated JGBs that it built up in February, for reasons explained below. Nomura estimates that it controls 25-30% of secondary market trading in Euroyen, and talks daily to a broad range of investors. Feedback from its salesforce at the beginning of April suggested that European investors, particularly UK-based index-funds, had started re-weighting their portfolios.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.


Unlimited access to and

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually


Unlimited access to and, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors


Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree