Seoul: South Korea has successfully issued US$3 billion worth of foreign exchange stabilization bonds, marking the biggest single issuance since 2009, the finance ministry announced on Friday. The issuance is composed of two tranches: $1 billion in three-year bonds and $2 billion in five-year bonds, as reported by the Ministry of Economy and Finance.
According to Yonhap News Agency, this bond issuance is the largest single-bond offering aimed at bolstering foreign exchange reserves since 2009. The ministry highlighted that the spreads over comparable U.S. Treasury yields were 9 basis points for the three-year bonds and 12 basis points for the five-year bonds.
The ministry further explained that the three-year bonds were made available to retail investors for the first time in response to rising demand for short-term bonds. This issuance also marks the first instance where the spread has decreased to a single-digit level. Additionally, the spread for the five-year bonds has decreased significantly, moving from 24 basis points in 2024 to 17 basis points in October, and now down to 12 basis points.