Eximbank issues $2.5 bil. in global bonds

The Export-Import Bank of Korea headquarters / Yonhap

By Yoon Ja-young

The Export-Import Bank of Korea (Eximbank) issued a total of $2.5 billion in global bonds on Monday, targeting investors worldwide.

This is the first global bond issuance by a Korean entity since the reopening of the foreign currency debt markets in the second half of this year. It is expected to set benchmarks for $20 billion in overseas bonds to be issued by Korean institutions by the end of this year.

The maturities and issuance amounts of the bonds are as follows: $500 million worth of two-year maturity bonds, $1 billion worth of five-year bonds, $500 million worth of 10-year bonds and four-year bonds worth 500 million euros, all offering a fixed rate. BofA, Deutsche Bank, KDB, Mizuho, Nomura, Societe Generale and Standard Chartered are in charge of the bond issuance as the lead managers.

By combining various currencies and maturities, the issuance of global bonds by the Eximbank is expected to meet huge investment demand in the market.

In particular, bonds with maturities of 5 years or less, which are mostly issued by Korean institutions, are expected to get the spotlight of investors.

Logo of the Export-Import Bank of Korea (Eximbank) / Courtesy of Eximbank

Meanwhile, Eximbank raised the status of Korean bonds in the global market by achieving the largest annual cumulative public offering of Korean bonds ever in both U.S. dollars and euros. The amount stands at $6 billion and 1.85 billion euros.

Eximbank is evaluated to have raised its status in the Korean bond market to a higher level with this issuance.

It has received effective orders totaling approximately $7.7 billion, nearly four times the target amount, from a total of 331 investors in U.S. dollar bonds.

The investors are mostly international organizations and central banks, with a focus on the United States, Europe and the Middle East by region. International organizations and central banks account for 38 percent of the investors, while pension funds, insurance companies and banks account for 35 percent. Asset management companies account for 26 percent. By region, 45 percent of the investors are from the U.S., followed by Europe and the Middle East at 33 percent. Asian investors make up 22 percent.

Eximbank announced that the funds it raised this time would be spent to support the advancement of Korean companies into markets overseas and for the stabilization of supply chains, among other purposes.