July Corporate Stock Issuance... Increased by 73% Compared to Previous Month

Published 24 Aug.2021 11:07(KST)

[Asia Economy Reporter Ji-hwan Park] Last month, in domestic companies' direct financing fund procurement, stock issuance increased while corporate bond issuance decreased. In particular, stock issuance surged due to large IPOs (Initial Public Offerings) such as KakaoBank.

According to the "July Corporate Direct Financing Performance" announced by the Financial Supervisory Service on the 24th, stock issuance in July amounted to 4.0554 trillion KRW, a 73.3% increase compared to 2.3403 trillion KRW in the previous month. Large-scale corporate IPOs such as KakaoBank (2.5526 trillion KRW) and SD Biosensor (517.6 billion KRW) expanded the issuance scale significantly. Paid-in capital increase was 847.1 billion KRW, down 61.9% from the previous month when large-scale fundraising by listed companies was active.

Last month, the scale of corporate bond issuance was 16.966 trillion KRW, down 12.3% from the previous month. Although general corporate bonds increased mainly in non-investment grade bonds, overall issuance decreased due to a decline in financial bonds and asset-backed securities (ABS).

General corporate bond issuance was 4.823 trillion KRW, up 8.4% from the previous month. The proportion of refinancing and operating funds decreased, while facility funds expanded. Financial bonds amounted to 11.405 trillion KRW, down 12.6% from the previous month. Financial holding company bonds were issued at 787 billion KRW, increasing 96.8% from the previous month. Bank bonds were 3.76 trillion KRW, down 15.6% from the previous month. Credit card companies and installment finance companies saw issuance decrease by 31.2% and 14.6%, respectively. Securities companies expanded issuance by 54.3%. ABS issuance was 738 billion KRW, down 60.0% from the previous month.

Regarding short-term fund issuance performance last month, commercial paper (CP) issuance was 32.6944 trillion KRW, up 1.2% from the previous month, while short-term bonds issuance was 104.2006 trillion KRW, down 8.5% from the previous month.