Q3 Foreign Financial Assets Reach Record High... Impact of Increased Overseas Securities Investment

Foreign Debt and Foreign Claims Also at Record High as of Late September

[Asia Economy Reporter Jang Sehee] As individual investors' purchases of overseas stocks increase, South Korea's external financial assets have risen to an all-time high. Although external debt also set a record high due to the International Monetary Fund (IMF) Special Drawing Rights (SDR) increase, the Bank of Korea judges that debt soundness indicators such as the short-term external debt ratio are not unfavorable.

According to the 'International Investment Position' announced by the Bank of Korea on the 18th, South Korea's external financial assets in the third quarter were recorded at $2.104 trillion, an increase of $30.6 billion compared to the previous quarter, marking an all-time high. Despite stock price declines in major investment countries such as the United States and China, factors such as domestic investors' 'Seohak Ant Movement' and overseas stock investment fever, as well as an increase in central bank reserve assets, also had an impact. Securities investment increased by $8.3 billion, and central bank reserve assets also rose by $9.9 billion.

External financial liabilities (foreigners' domestic investment) stood at $1.4948 trillion, decreasing by $87.9 billion from the end of June, mainly due to non-residents' securities investment (-$89.7 billion).

Lee Saerom, head of the Bank of Korea's Foreign Investment Statistics Team, explained, "External financial assets are at an all-time high," adding, "This is because residents' overseas securities investment and direct investment increased, and the Bank of Korea's foreign exchange reserves also rose following the IMF Special Drawing Rights allocation."

As external financial assets increased and external financial liabilities decreased, South Korea's net external financial assets (external financial assets minus external financial liabilities), which reflect the country's external payment capacity, also reached a record high of $609.2 billion.

As of the end of September, external debt was $610.8 billion, up $6.6 billion from the end of June ($604.2 billion), and during the same period, external claims ($1.0754 trillion) also increased by $14.3 billion.

Net external claims, calculated by subtracting external debt from external claims, rose by $7.7 billion over three months to $464.6 billion.

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