Many Japanese companies are paying more to raise money from shorter-tenor notes as the Bank of Japan prepares to wind down corporate bond purchases as part of its historic move away from ultra-accommodative policy. Sumitomo Mitsui Trust Panasonic Finance Co. on Friday sold three-year yen notes at a much higher premium than corporate bonds sold before the central bank scrapped the world’s last negative interest rate on March 19. Top-rated Toyota Finance Corp. last week priced a three-year note at a significantly wider spread than lower-rated Sony Group Corp.’s deal in March. “Investors are asking for higher premiums on new bonds now that the BOJ has made it clear that the corporate bond buying will end,” said Haruyasu Kato, a fund manager in Tokyo at Asset Management One Co. The impact of the central bank’s reduction in purchases on short-term borrowing costs for corporates underscores how Japanese markets are adapting after years of ultra-easy money. The BOJ said on March 19 that it plans to end the program within a year. Here are some examples of spreads on yen-denominated bonds: The BOJ embarked on the corporate bond purchase program in 2013, and has been buying investment-grade credit with a remaining maturity of three years or less in the secondary market. That prompted the so-called “BOJ trade,” in which investors bought three-year company notes in the primary market in the hopes of selling them to the central bank at a higher price. Japan’s central bank said on March 29 that it plans to buy corporate bonds ¥75 billion ($490 million) in May. That marks a slowdown from monthly purchases of ¥100 billion recently. The widening in premiums on three-year notes contrasts with spreads on yen-denominated bonds overall, which have been tightening to the lowest since July 2022, according to a Bloomberg index. The extra yield investors seek on municipal bonds, which are not part of the central bank’s bond buying program, is narrowing as well.