[Asia Economy Reporter Kim Min-young] IBK Industrial Bank of Korea announced on the 16th that it has successfully issued a $500 million foreign currency social bond.
The bond has a maturity of 5 years and a fixed interest rate of 1.04% per annum (U.S. Treasury yield + 72.5 basis points (1bp = 0.01 percentage points)).
The bank stated, "Despite increased market volatility due to the novel coronavirus disease (COVID-19), we succeeded in issuing bonds at a low interest rate thanks to strong investor demand for Korean bonds."
Social bonds are a type of environmental, social, and governance (ESG) bond, which are special-purpose bonds issued to raise funds for projects that promote public interest. The funds raised are used to fulfill corporate social responsibility.
IBK plans to use the raised funds to support small business owners and small and medium-sized enterprises (SMEs) struggling due to COVID-19.
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Yoon Jong-won, President of IBK, said, "Interest from various investors including central banks and international organizations led to the successful bond issuance," adding, "IBK will continue to strive to fulfill its social responsibilities."
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