November Stock Issuance Down 30%... Corporate Bonds Also Down 20%

[Asia Economy Reporter Koh Hyung-kwang] The scale of stock issuance last month decreased by nearly 30% compared to the previous month. This was largely due to the base effect from a large-scale initial public offering (IPO) in the previous month. Corporate bonds also saw a reduction in issuance volume across general corporate bonds, financial bonds, and asset-backed securities (ABS) due to seasonal factors.

According to the Financial Supervisory Service's report on "Corporate Direct Financing Performance in November 2020" released on the 30th, the total funds raised by companies in the capital market, rather than bank loans, amounted to 16.2838 trillion won last month, down 21.2% (4.4006 trillion won) from the previous month (20.6844 trillion won).

The scale of stock issuance last month was 21 cases totaling 871.3 billion won, more than double the number of cases from the previous month (10 cases, 1.2399 trillion won), but the amount decreased by 29.7% (368.6 billion won). For IPOs, there were 12 cases (365.1 billion won), an increase in the number of cases compared to the previous month (6 cases, 1.072 trillion won), but the issuance amount decreased by 706.9 billion won due to the base effect from the large-scale IPO in October (Big Hit Entertainment, 962.6 billion won). The scale of paid-in capital increase was 9 cases totaling 506.2 billion won, both the number of cases and amount increased compared to the previous month (4 cases, 167.9 billion won).

The scale of corporate bond issuance last month was 15.4125 trillion won, down 20.7% (4.032 trillion won) from the previous month. Three banks?Shinhan Bank (1.96 trillion won), Kookmin Bank (1.7 trillion won), and Hana Bank (1 trillion won)?each issued corporate bonds exceeding 1 trillion won.

For general corporate bonds, issuance was 1.59 trillion won (18 cases), down 44.2% (1.259 trillion won) from the previous month (2.849 trillion won, 30 cases), mainly due to continued issuance of medium- to long-term bonds for debt repayment purposes. Financial bonds amounted to 11.4939 trillion won, down 17.3% (2.4015 trillion won) from the previous month (13.8954 trillion won). ABS issuance was 2.3286 trillion won (107 cases), down 13.8% (371.5 billion won) from the previous month. As of the end of November, the outstanding balance of corporate bonds was 574.3918 trillion won, up 1.1% from the previous month.

The issuance performance of short-term funds such as commercial paper (CP) and short-term bonds totaled 138.549 trillion won, up 12.5% (15.433 trillion won) from the previous month (123.116 trillion won). CP issuance was 36.2164 trillion won, down 2.902 trillion won (7.4%) from the previous month, while short-term bonds increased by 18.3349 trillion won (21.8%) to 102.3326 trillion won. As of the end of last month, the outstanding balance of CP was 190.0453 trillion won, and short-term bonds were 50.7368 trillion won.

This content was produced with the assistance of AI translation services.