University of Tokyo to sell bond in first of Its kind for Japan

[TOKYO] The University of Tokyo is preparing a bond offering that would be the first of its kind in Japan, at a time when demand for higher-education debt is picking up overseas amid falling interest rates.

The university plans to sell 20 billion yen (S$259.35 million) of 40-year securities in early October, according to a statement from Daiwa Securities.

The move follows relaxation of debt-sale rules by Japan's education ministry in June. Previously, national universities could only sell notes to finance their affiliated hospitals and other limited projects. Under the new rule, universities can finance research and education projects, according to the ministry.

The debt sale by the Tokyo college, generally considered one of the nation's top schools, comes as investors rush to buy debt of elite universities in the US for their high credit ratings and long maturities. American universities such as Harvard and Princeton have sold more than US$30 billion of bonds this year, joining the global boom in corporate debt deals.

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