KB Kookmin Card Issues Foreign Currency-Denominated Sustainable Bonds... "USD 300 Million Scale"
5-Year Maturity Fixed-Rate Bond Denominated in US Dollars
Issued at an Annual Interest Rate of 1.5%
[Asia Economy Reporter Ki Ha-young] KB Kookmin Card announced on the 10th that it has issued its first-ever foreign currency-denominated sustainable bond worth 300 million dollars (approximately 337 billion won).
The bond issued this time is a 5-year fixed-rate bond denominated in US dollars. The issuance interest rate is 1.50% per annum, which is the 5-year US Treasury yield plus a spread.
At an investor briefing held earlier this month targeting the Asian and European markets for demand forecasting, more than 60 investors expressed interest in participating with a total of over 1.1 billion dollars, resulting in issuance at 37.5 basis points (0.375 percentage points) lower than the initially proposed rate (IPG).
The international credit rating agency Moody's assigned an 'A2' rating to the foreign currency-denominated senior unsecured bonds issued this time.
The bonds issued this time are sustainable bonds used to promote projects that have a positive impact on the environment and society. The funds raised will be used to provide financial support to low-income and socially vulnerable groups and to various projects that create social value.
To eliminate exchange rate fluctuation risk arising from the issuance of dollar-denominated bonds, a Cross-Currency Interest Rate Swap (CRS) was entered into to exchange principal and interest payments between different currencies, thereby enhancing the stability of fundraising through overseas markets and minimizing volatility.
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A KB Kookmin Card official said, "This foreign currency-denominated bond issuance is expected to have a positive impact on diversifying funding methods and channels beyond the existing won-denominated card bonds and foreign currency asset-backed securities (ABS), contributing to stable long-term funding."
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