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The Public Investment Fund (PIF) inked five MoUs valued at a combined USD 51 bn with major Japanese lenders, in a bid to fuel capital flows between the two countries through debt and equity, according to a PIF statement.
The banks involved: Mizuho Bank, Sumitomo Mitsui Financial Group, MUFG Bank, Japan Bank for International Cooperation (JBIC), Nippon Export and Investment Ins. (NEXI). The specifics of the agreements were not disclosed.
Priority sectors: “The MoUs are a key part of PIF’s strategy to boost financial collaboration globally, enhancing cooperation in finance, investment and sustainable development.”
Not the first time the PIF has looked to Asia this year: The sovereign wealth fund inked similar agreements with major Chinese banks last August, signing six MoUs worth up to USD 50 bn also intended for two-way capital flows and focused on the same sectors.
IN OTHER NEWS FROM PIF AND JAPAN-
Middle Eastern-focused Index fund for Japanese investors next year? PIF and Mizuho Financial Group plan to launch an index fund targeting Japanese institutional investors that want to invest in Middle East stocks by March 2025, Mizuho spokesman Naohiro Takahashi confirmed to Bloomberg. The fund seeks to lure investors with higher returns in Saudi Arabia, with the Kingdom’s current benchmark interest rate standing at 5.5% compared to Japan’s 0.25%.
REMEMBER- Mizuho is reportedly looking to open its regional headquarters in the Kingdom after receiving a license from the Investment Ministry. The firm has participated in debt capital market transactions for clients including PIF, the Finance Ministry, and Aramco, among others. It has had an investment banking license in Riyadh since 2009.
