Financial Services Agency promotes price information infrastructure development to revitalize corporate bond secondary market

It was revealed on the 11th that the Financial Services Agency has decided to set up a price information infrastructure in order to revitalize the secondary market for buying and selling corporate bonds. Collaborate with industry organizations to support the design and construction of information systems. By making it easier for institutional investors to buy and sell corporate bonds, we support companies in raising funds for growth investment.

The Financial Services Agency has included related budgets in its budget request for fiscal year 2027. Currently, the Japan Securities Dealers Association publishes prices, redemption dates, interest rates, etc. for some stocks, but the idea is to widen the scope and make transaction information easier to see and increase transparency.

Corporate bonds are bonds issued by companies to raise funds from the market. Investors who purchase the bonds receive periodic interest and the principal is repaid at maturity unless the company goes bankrupt. Diversification of procurement methods has become an issue in order to respond to the increasing demand for funds by companies for large-scale capital investments and M&A (mergers and acquisitions).

Many Japanese companies rely on loans from banks, and the government's financial strategy, formulated in July, points out that the corporate bond market is ``fewer issuers and investors compared to the United States.'' The government has amended the Industrial Competitiveness Enhancement Act and is also moving forward with deregulation to encourage the issuance of small-sized and low-rated corporate bonds.