Treasury ready to act on second Samurai bond, awaits PM’s order

(Bernama pic)

PUTRAJAYA: The finance ministry is ready to act if the second Samurai bond issuance is continued, and is awaiting further instructions from Prime Minister Dr Mahathir Mohamad in relation to his statement on its issuance, the ministry said in a statement today.

It also said the prime minister was taking into consideration the views of various parties although the interest rate of the second Samurai bond was lower.

Mahathir told a media conference yesterday that Malaysia had received the agreement of Japanese Prime Minister Shinzo Abe for the issuance of the bond and it was up to Finance Minister Lim Guan Eng to continue negotiations.

In June, the ministry had received instructions from the prime minister to initiate negotiations with the concerned parties after his visit to Japan in May, where he was offered the second of the Samurai bond series.

The Cabinet had also stated its agreement in principle, with further details to be scrutinised by the ministry, the statement said.

After discussions by the finance minister with those representing the Japanese government, particularly the Japan Bank for International Cooperation, which will guarantee the issuance of the Samurai bond, the interest rate was reduced to 0.5% with a maturity period of 10 years.

The interest rate for the first Samurai bond of 200 billion yen was 0.63% with a similar maturity period of 10 years.