Korea's No. 5 lender Korea Exchange Bank (KEB) said Friday that it has raised $300 million by selling global bonds amid favorable market conditions following a series of upgrades of Korea's sovereign rating.
The lender said the three-year bonds carry an interest rate of 155 basis points higher than the yield on two-year U.S. Treasuries. A basis point is 0.01 percentage point.
The debt sale, whose subscription totaled $4 billion from 170 foreign investors, came as Korea's borrowing costs have been reduced on the back of the upgrades of the credit rating on Asia's fourth-largest economy, said KEB, controlled by Hana Financial Group.
Recently, all three global credit appraisers -- Moody's, Fitch and Standard & Poor's -- raised their credit ratings on South Korea to levels seen before the 1997-1998 financial crisis, citing the country's fiscal soundness and lowered geopolitical risks.
A higher sovereign rating helps lower the spread when selling debts as a country's default risk diminishes.
In September, state-run Korea Development Bank and NongHyup Bank floated bonds in overseas markets amid the favorable borrowing conditions. (Yonhap)
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