In a world of falling interest rates, US universities like Harvard and Princeton are finding love for their bonds from international investors seeking extra yield.

Demand for debt of American colleges has increased recently from investors in places like Japan, South Korea, Singapore, and Taiwan, market participants say. That’s helped the universities price about $36 billion of bonds this year, the most since at least 2004, as they join a global boom in debt deals.

While colleges face uncertainties this academic year after having to close or modify campuses because of the coronavirus, many global investors are finding the long-term stable outlook of the schools particularly appealing as weaker borrowers stumble. For investors in countries that need funds to support aging populations like Japan and South Korea, the perceived strength of the issuers for years to come is a particular draw.

“Those types of credits help investors sleep at night,” said John Augustine, a managing director at Barclays who runs the bank’s higher education group. He said he’s seen an increase in Asian investors interested in college and university bonds over the last three to six months.

Such buyers are drawn to high-quality names at major private and public research universities, usually rated AA or higher, Augustine said. His firm is one of the top-ranked dealers for debt sold by US universities, according to Bloomberg-compiled data.

South Korea’s Samsung Life Insurance Co, the nation’s biggest life insurer, has previously bought such debt and is considering additional investments that offer a bit more yield than local notes, it said.

Wealthy Korean individual investors are interested in US college bonds as well, according to Kim Sung-soo, a Seoul-based credit analyst at NH Investment & Securities, who recommends debt of highly ranked universities such as Yale and Harvard given their large endowments and high credit scores.

Top-graded university bonds also offer a yield premium to US sovereign debt. Harvard’s AAA rated notes due in 2050, for instance, initially priced at a 2.517 per cent yield or 110 basis points more than Treasuries.