Japanese asset-backed issuance maintained an upbeat pace, as issuers rushed to acquire new funds before the country's fiscal year ends at the end of this month. As before, equipment leases and consumer loans were the mainstays of the previous two weeks' issues, which were all placed in the domestic market.
Daiwa SB Capital Markets kept busy with two issues: the larger was a 12 billion ($111 million), credit card receivables-backed transaction originated by Daiei OMC, a major retailer-affiliated credit card company. The issue by Daiei OMC Asset Management Co. Ltd. comprised nine tranches of bullet securities with yields ranging from 0.15% to 0.67% and a final legal maturity in 2003.
Yasuda Fire & Marine guaranteed the issue, and Moody's Investors Service rated it Aaa.
Daiwa's second transaction was a private 9.6 billion, equipment lease-backed issue by Asahigin Leasing Co., which was the third in a series issued by an SPC called AL Asset Management Company Ltd. It was also rated Aaa by Moody's.
Orient Corp., Japan's biggest ABS issuer, once again tapped the domestic market with its fourth shopping loan-backed securitization. The 30 billion issue, issued by Orico Shop Aries SPC, was arranged by DKB Securities and comprised five tranches of bonds priced from 0.58% to 1.19% with tenors ranging from two to four years. The entire issue was rated triple-A by both Moody's and Standard & Poor's.
DKB also arranged a 10 billion equipment lease securitization originated by Tokyo Leasing Co. The issue from TLC Finance Co. comprised fifteen tranches of bonds rated Aaa by Moody's. Pricing was not available at press time.
Finally, Merrill Lynch brought to market a collateralized bond obligation, which provided a breather from run-of-the-mill Japanese lease and loan-backed deals. The 16.1 billion, five-year issue by Aprecia Asset Funding is the first securitization of Japanese convertible bonds.
A total of 23 convertible bonds issued by 20 Japanese corporations from a wide variety of industries backed the issue, which was rated Aaa by Moody's. It was priced at 25 basis points over three-month Libor and issued in the Euromarket.