Guan Eng: Mizuho, HSBC, Daiwa appointed lead arrangers for Malaysia's ¥200b Samurai bond

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PUTRAJAYA (Jan 18): Finance Minister Lim Guan Eng said today Malaysia has appointed Mizuho Bank (M) Bhd, HSBC Bank Malaysia Bhd and Daiwa Capital Markets Ltd as lead arrangers for the nation's proposed 10-year ¥200 billion (about RM7.6 billion) Samurai bond issue.

Lim said the appointments will ensure the country enjoys the lowest possible cost of funds.

At a press conference here today, Lim said the appointments were made after six proposals were shortlisted from the 27 received by the Ministry of Finance (MoF).

"The final decision was made after the MoF was convinced that these three were the best institutions which have the necessary experience, expertise and most importantly, conviction and faith in the Malaysian economy, to ensure that we will enjoy the lowest possible cost of funds.

"As part of a government-to-government arrangement, the Japan Bank of International Cooperation (JBIC) will be guaranteeing the bond. This will allow the government of Malaysia to pay all-inclusive indicative coupon rates of less than 0.65% per annum, including the guarantee fee," Lim said.

Lim, who is spearheading the fundraising exercise, said the bond is expected to be raised in the next few months.

"I have been directed by Prime Minister Tun Dr Mahathir Mohamad in my capacity as the Finance Minister to handle the entire bond issuance and lead a Malaysian delegation to Tokyo in February 2019 to meet all the relevant investors to ensure a successful bond-raising exercise," Lim said.

According to Lim, the Samurai bond issuance is a testament of confidence the Japanese government has in the leadership of Dr Mahathir and a mark of the intimate relationship between the two countries.

"We would like to voice our thanks and appreciation towards the Japanese government for providing the guarantee for the bond, as well as to the Japanese Ambassador, His Excellency Dr Makio Miyagawa for his invaluable assistance and contribution towards ensuring a smooth negotiation exercise," Lim said.

Lim said the last Samurai bond arrangements between Malaysia and Japan can be traced back to 1989.