Mitsubishi UFJ Financial Group Inc. raised 570 billion yen ($4 billion) worth of debt in what is Japan’s biggest yen bond deal this year.

With yields rising, the lender offered a coupon of 2.127% on the perpetual non-callable 10-year and one-month Additional Tier 1 bonds, underwriter Mitsubishi UFJ Morgan Stanley Securities Co. said. That’s the highest coupon on such notes for the bank since 2015, according to Bloomberg-compiled data.

Friday’s deal marks the second offering of AT1 bonds in Japan by a major bank since March, when Credit Suisse Group AG’s contingent convertible bonds got written down by the Swiss regulator as part of its shotgun marriage to UBS Group AG. That was the biggest loss for the market to date.

The average yield on the riskier bank bonds globally, including yen notes, is about 10%, down from a year-to-date high of 13.6% after the collapse of Credit Suisse, a Bloomberg index shows.

MUFG’s sale comes against a backdrop of a rebound in AT1s, and is also a reminder of Japan’s unique position, with years of ultra-low interest rates fueling demand for higher-yielding assets. The deal also includes a total loss-absorbing capacity tranche.

Demand for Japanese AT1 bonds will likely remain strong because of lower risk of a technical bankruptcy than in Europe, Kenji Isomoto, a manager in the global markets department at Mitsui Sumitomo Insurance Co., said in an email.

The lender priced its AT1 bonds at spreads five to six basis points tighter than the levels offered on Sumitomo Mitsui Financial Group Inc.’s comparable debt sale last month.

Even so, premiums on some of MUFG’s outstanding AT1 debt are more than 30 basis points wider than March when Credit Suisse was rescued, as investors in Japan also seek greater compensation for the riskier bank notes.

Japan’s largest bond deal was Nippon Telegraph & Telephone Corp.’s 1 trillion yen offering in 2020.

--With assistance from Finbarr Flynn.

(Adds comment in fifth paragraph, comparison of pricing in sixth paragraph.)