The South Korean government started marketing its first-ever "samurai bond" Monday, in the latest sign of how President Yoon Suk-yeol is spearheading a transformation in relations with Japan.
Initial price guidance for the three-year part of the multi-tranche debt offering is 23 to 27 basis points over mid-swaps, according to a person with knowledge of the matter. That’s a much tighter spread than other samurai issuers’ similar-maturity debt sold this year, helped by South Korea’s government having some of the highest credit ratings among emerging economies.
The historic debt offering comes as part of broad-based improvement in ties between the two countries since Yoon took office last year, with both sides seeking to move past decades of friction. The issuance of yen bonds by South Korean companies has long been affected by the ebb and flow of bilateral political relations. Sales have seen a renaissance in the last 18 months with four South Korean firms pricing samurai bonds including Korea Investment & Securities' debut notes in July.