Foreign currency deposits rise $1.57 billion in May on large corporate inflows

By Kim Byeo-ri, The Herald Business

Dollar-denominated foreign currency deposits swelled by more than $1.5 billion in a single month amid a continued dollar strengthening, driven by large corporate current-account receipts and margin deposit inflows from securities firms.

Foreign currency deposits held at domestic foreign exchange banks by residents stood at $112.25 billion at the end of May, up $1.57 billion from the end of April, the Bank of Korea said Friday in its monthly report on resident foreign currency deposit trends.

Resident foreign currency deposits cover accounts held domestically by Korean nationals, domestic companies, foreigners who have resided in Korea for at least six months, and foreign companies operating in the country.

The overall increase was led by dollar-denominated deposits and corporate deposits.

Dollar deposits rose $2.24 billion, from $93.32 billion at the end of April to $95.56 billion at the end of May.

Yen deposits and euro deposits, by contrast, fell by $690 million and $280 million, respectively, to $7.52 billion and $6.3 billion.

The Bank of Korea said dollar deposits grew on the back of current-account receipts by large conglomerates and margin inflows from securities firms' derivatives transactions.

Yen deposits declined due to a drop in customer deposits held by securities firms and current-account payments, while euro deposits fell mainly on current-account payments, the central bank added.

Corporate deposits rose $2.54 billion to $97.42 billion, while individual deposits fell $960 million to $14.83 billion.