Buying and Selling at the Secondary Market

Investors trade JGBs in the secondary market though exchange transactions and over-the-counter (OTC) via securities companies.

JGB trading is done between transfer accounts, which bondholders open and hold at financial institutions. Trades are recorded in those accounts via the Bank of Japan Financial Network System (BOJ-NET) on a delivery versus payment (DVP) basis.

Payment of Interest & Redemption

Interest and principal payments are through book-entry systems automatically paid to investor accounts. As JGB payment transactions are paperless, payment appear in investors transfer accounts as an increase (purchase) or decrease (sale) in the account balance. Investor balances are confirmed in the balance statements of the financial institution managing the account.

Reopening Issues

Reopenings are the offering of new securities with the same terms and conditions as an existing issue. They are used to increase the size of an outstanding issue. A reopened bond has the same maturity date, security identifier and coupon rate as the original security. The only difference is that they have a different issue date and usually, a different purchase price based on current market yields.