Hyundai Capital Issues $700 Million Global Bonds

Green Bond Procurement Funds Used Exclusively for Zero-Emission Vehicle Financial Services Support

[Asia Economy Reporter Ki Ha-young] Hyundai Capital announced on the 19th that it has issued $700 million worth of global bonds.

The successfully issued global bonds this time are 'dual tranche' bonds with different issuance conditions, with maturities of 3.25 years and 5 years (Green Bond), respectively.

The bond sizes by maturity are $400 million for 3.25 years and $300 million for 5 years. The issuance interest rates were set at levels adding 87 basis points to the US 3-year Treasury yield and 97 basis points to the 5-year Treasury yield.

In December last year, Kia increased its stake in Hyundai Capital from 20.1% to 40.1%, raising the combined stake of Hyundai Motor and Kia in Hyundai Capital to 99.8%, further strengthening Hyundai Capital's position as an exclusive financial company. This issuance is the first global bond issuance following this governance restructuring.

The funds raised through the 5-year maturity Green Bond will be exclusively used to support financial services for Hyundai Motor and Kia's zero-emission vehicles such as electric and hydrogen vehicles. This is interpreted as Hyundai Capital's proactive response to the recently strengthened clean transportation standards under the Green Taxonomy.

Previously, Hyundai Capital was the first automotive finance company worldwide and the first private company in Korea to successfully issue a $500 million Green Bond in 2016. This issuance is the third global Green Bond issuance following the $600 million Green Bond issued in February last year.

A Hyundai Capital official stated, "This global bond issuance attracted significant interest, with orders from more than 140 institutional investors worldwide, despite increased interest rate volatility due to the impact of COVID-19 variants and global inflation concerns."

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