S Korea’s corporate bond issuance rises in November

Insight Online News

Seoul, Dec 22 : South Korea’s corporate bond issuance rose in single digit last month on expectations for higher borrowing cost, financial watchdog data showed Wednesday.

Local companies sold bonds worth 17.52 trillion won (about 14.7 billion U.S. dollars) in November, up 5.1 percent from a month earlier, according to the Financial Supervisory Service.

Financial companies raised money through the bond issuance amid growing expectations for higher interest rate.

The country’s central bank hiked its benchmark interest rate from an all-time low of 0.50 percent to 0.75 percent in August, before lifting it further to 1.00 percent in November.

Expectations ran high for the Bank of Korea (BOK) to raise its policy rate further next year.

The bond issuance by financial firms increased 8.5 percent over the month to 13.1 trillion won (about 11 billion dollars) in November.

The sale of asset-backed securities (ABS) jumped 70.5 percent to 2.36 trillion won (about 2 billion dollars) last month, but the bond issuance by industrial companies diminished 35.7 percent to 2.06 trillion won (1.7 billion dollars).

Corporate equity financing, which includes the initial public offering (IPO) and the rights issuance, sank 22.4 percent from a month earlier to 1.93 trillion won (about 1.6 billion dollars) in November.


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