S. Koreas Direct Financing Tumbles in January

South Korean companies' direct financing plunged 45 percent in January from a month earlier as firms reduced stock and bond issuances amid global market jitters,

the financial watchdog said Tuesday.

According to the Financial Supervisory Service, local companies raised 3.98 trillion won ($4.2 billion) by floating stocks and bonds in January, compared with 7.2 trillion won the previous month.

The issuance of shares tumbled 85.1 percent month-on-month to 338.4 billion won amid stock market fluctuation. South Korea's key stock index fell 14.4 percent in January, mainly because investor sentiment was dented over a global economic slowdown stemming from a credit squeeze.

Meanwhile, companies raised 3.64 trillion won in January by selling bonds, down 26.6 percent from the previous month, the watchdog said. Debt sales by non-financial firms inched up 2.1 percent to 1.99 trillion won, and financial companies' debt offerings reached 1.3 trillion won, up 55.9 percent from a month earlier.

The issuance of asset-backed securities fell 84.1 percent to 346.1 billion won in January. Asset-backed securities are bonds or notes backed by assets, which consist of debt obligations including car loans, home equity loans, credit card receivables and student loans. (Yonhap)