Korea Securities Finance debuts in global bond market with first foreign currency bond

Korea Securities Finance announced Tuesday that it had successfully issued $300 million in foreign currency-denominated bonds — its first global bond issuance since the company's founding — marking its debut in global capital markets 71 years after it was established in 1955.

The company issued a three-year US dollar-denominated public bond at a rate of 4.977 percent, or 0.47 percentage points above the three-year US Treasury yield. Moody's assigned the bond an Aa2 rating, on par with South Korea's sovereign credit rating.

The issuance makes Korea Securities Finance the first securities finance company in the world to issue a publicly offered global bond. To mark the occasion, the company held a signing ceremony for the underwriting agreement with relevant institutions on Friday.

Investor orders reached the highest level among recently issued Korean paper carrying the sovereign credit rating, totaling $2.4 billion — eight times the issuance amount. By investor type, banks accounted for 48 percent of orders, asset managers 39 percent and others 13 percent.

"Despite this being our inaugural issuance, high-quality global investors participated," the company said, adding that it had actively promoted its public role in the capital markets and strong financial soundness to investors through roadshows in Singapore and Hong Kong to generate such demand.

Korea Securities Finance is the country's only dedicated securities finance company, established to support the securities industry. It provides loans to financial investment firms using securities as collateral and manages investor deposit funds, among other services. Since taking office, President and CEO Kim Jeong-gak has pursued an expansion of the company's global capabilities, including obtaining a license for foreign exchange swap trading and establishing a subsidiary in Hong Kong.