By selling commercial paper at negative interest rates, a Japanese leasing company will get paid enough money to buy a bottle of Dom Perignon Rose Vintage 2004 if it wants.
Sumitomo Mitsui Finance & Leasing Co., a unit of the nation's second-biggest lender by market value, is set to become the first Japanese company to issue debt and get paid for it, according to the financier. The firm stands to receive ¥5 billion ($44.2 million) plus ¥25,890 next week when it sells the commercial paper and will only have to repay ¥5 billion in six months' time. It will have about $230 left over, enough to buy the bottle of champagne or 100 cans of beer, according to prices on Amazon.co.jp.
The sale would be the first example of Japanese corporate debt sold at interest rates below zero after the Bank of Japan's adoption of a negative-interest-rate policy in January caused yields on sovereign notes of as long as 10 years to fall to minus levels. The deal may be a forerunner to issuance of longer-term debt by companies at negative rates, according to analysts at Mizuho Financial Group Inc. and Nomura Holdings Inc.