The heat is on!

The announcement of our 2nd mtn-i Uridashi Awards comes at an interesting moment in the history of the world’s longest established market dedicated to yield enhancement for retail savers. The yen’s strength has dented both FX-linked demand and the quanto swap-driven yields achievable on non-Japanese index-linkers. Meanwhile the attractive return on Japanese household names’ retail offerings, such as Softbank’s JPY1trillion retail jumbo and megabank’s juicy subordinated debt, proved a competitive challenge to both vanilla and structured Uridashi notes.

We weighed issuer and dealer pitches with our own analysis of the market’s key themes, trends and performances, using the mtn-i data and analytics platform to crunch almost 1,300 Uridashi deals equivalent to USD22bn across vanilla and five types of asset classes sub-dividing into 10 different products – and reported in our daily news coverage.

Resilience testing

Our inaugural awards last year paid homage to the Uridashi market itself – a story which began in the 1980s which mtn-i’s data and news coverage have been dedicated to covering for the last two decades. Our 2nd Uridashi awards spotlight the institutions, products and trends that proved resilient in the face of these significant challenges during the past 12 months. And of course, the headwinds they represent to the investment strategy of the CIO of the Japanese savings pool characterised as Mrs Watanabe – reputed by many bankers to have a better track record than many hedge fund managers.

Much more importantly for the long run, we reveal the more systemic shifts of institutional attention, product innovation and creative product and distributor alliances that affirm the Uridashi market’s biggest strategic importance. Notably this is its pioneering of sustainable capital market initiatives that improve the future prospects for the survival of our planet and the quality of human life upon it. A role and a trend so creatively epitomised by the multitude of SRI deals along our recognition of the rising temperature in Tokyo.

So it is, quite literally in every sense, that the heat is on in Uridashis – which makes us more excited than ever before in announcing these awards, presenting them and honouring this market next week at our 2nd mtn-i Uridashi Awards reception at MoodBoard in Tokyo, on Thursday, October 3rd.

Sustainability surging

As we announce the awards, investors in the previous weather-linker – a deal referencing the Tokyo temperature that we recognised last year – from the world’s only issuer of the product Monex, got healthy double digit basis point return on their investment. This made them among the first investors anywhere to receive returns from the impact of climate change itself.

Despite having a growing share of the overall market, SRI-linked sales still only jumped to 6% of the total market volume. But the innovation in the space could not have been more diverse or strategically significant. The SRI theme claimed six of our awards – in addition to the climate-related weather-linker – across all categories and the only theme to prove capable of this range.

SMBC Nikko’s performance – a powerful endorsement in its own right while also broadening its parent bank’s commitment to retail green bonds – earned the firm a Dealer Performance award. Meanwhile the World Bank’s raising of awareness for the UN’s Social Development Goals through highlighting the impact of food waste and preservation of water resources while exploring these themes in EM currencies and structures earned it a similar Issuer recognition. MUFG and the International Finance Corp enlivened the sector with the world’s first structured social bond via a dual FX structured series – delivering the SRI theme to the core of structured Uridashi demand. Monex’s innovation on its Tokyo temperature-linker and its new alliance with Leonteq, keeps rising temperatures in the frame with a new Deal of the Year award.

Dynamic dealers

Our overall institutional performance awards credit the depth and breadth of institutional Issuer and Dealer performances across the vanilla and structured Uridashi spaces as they navigated the challenging environment. In the case of this year’s winning issuers we also recognise their bounce back from the impact of regulatory challenges in Europe.

Our Dealer performance awards credit MUFG’s ongoing giant structured market share and lead over rivals, its domination of dual FX structures and notable firsts in the social and thematic Uridashi space. Nomura’s ongoing supremacy of the vanilla space, driven by the success of its sales for Toyota, stood out in a year marked by Softbank’s rivalry while TD gets credit as a Rising Star Dealer for the success of its new Uridashi business particularly in the innovative combination of SRI themes and EM FX in the toughest of the FX swap environments.

Enterprising dealers

SEK’s powerful return to prominence in Structured Uridashi made it our Issuer of the Year while Toyota’s success in a competitive credit space drove it to the Vanilla Issuer of the year. Power performer awards also recognise success for Kommuninvest in equity-linked structures and Rabobank’s sophistication as a vanilla issuer.

Delivering distributors

Our dedication to detailed Uridashi data collection, combined with mtn-i’s powerful search and analysis platform, illuminated the important contribution distributors, like Okasan Securities, play in opening investor demand to new products and themes such as the SDGs. Tokai Tokyo’s diverse origination and distribution of stock underlyings, earned it a Power Performer Award, as it delivered a key yield enhancement solution, similar to the ongoing trends in many other developed markets.

Structuring size and innovation

Deal of the Year recognitions for structured notes range from trendy US dollar rate-linkes to KfW’s return with its largest ever yen ELN ever to JP Morgan’s unique corporate event-linked series.

Click here to see all our award winners!

Celebrating Uridashi

Thank you so much to everyone who pitched for these awards. We look forward to celebrating this diverse new chapter in the Uridashi market’s history with you at Moodboard next Thursday .

Click here if you would like an invitation to attend – all market participants are welcome.

Warmest regards,
Mike Tims & Atanas Dinov
Founder & CEO / Assistant Editor