Jul
09
A Peculiar Practice in Japanese Bond Sales Hurts Investors and Banks
By-
Investors say some notes didn’t sell out as underwriters claim
- Bond managers said to sell at better rates to investors later
When Japan’s Denso Corp. issued 40 billion yen ($362 million) of bonds in a recent offering, its underwriters said the notes sold out. Investors weren’t so sure that was true.
That’s a reflection of a peculiar practice in Japan: underwriters keep it to themselves who the investors buying bonds are, unlike in the U.S. and Europe, where managers usually share information about the bidders. In Japan, if a sale doesn’t attract enough demand, bankers can keep the unsold portion themselves but still declare that everything was sold…
A Peculiar Practice in Japanese Bond Sales Hurts Investors and Banks
