이 기사는 2022년 01월 17일 07:41 thebell 에 표출된 기사입니다.

Woori Bank has successfully issued the first foreign currency-denominated bond this year, garnering orders worth more than two times the issue amount.

The Korean lender has issued its bond amid a sharp rise in short-term interest rates after U.S. Federal Reserve meeting minutes signaled the central bank may have to raise interest rates sooner than expected.

Woori Bank will sell a $500 million dollar-denominated bond maturing in five years, which drew about $1.3 billion in orders from investors in Asia, Europe, and the U.S. during its book building process.

The lender started the process for the bond issuance about three months ago. Back then, market insiders focused more on whether the U.S. Federal Reserve will speed up its tapering in the massive bond purchase program.

The minutes from the Fed's December 14-15 policy meeting, however, offered more details on the central bank's shift last month toward a tighter monetary policy to curb inflation. Policymakers had agreed to hasten the end of their pandemic-era program of bond purchases, and issued forecasts anticipating three quarter-percentage-point rate increases during 2022. This has made market participants to expect the Fed to start to raise its benchmark interest rate as soon as March, with four to five rate hikes this year.

Underwriters suggested Woori Bank to lower its initial price guidance (IPG) as increased interest rate volatility could hurt investor sentiment in the short-term.

“We decided to stick to the original plan despite some negative prospects because we believed there was abundant foreign currency liquidity,” said an official at Woori Bank. “I think we got into the market quickly and got the right timing amid growing volatility.”

Taiwanese investors showed keen interest in the deal. 84% of the bond was allocated to Asian investors, while 11% and 5% went to European and the Middle East investors and the U.S. investors.

Woori Bank decided not to increase the issue amount, but strong interests helped the lender to issue the bond at 30 basis points lower than its IPG of 90 basis points.

Woori Bank sold the dollar-denominated bond in the form of environmental, social and governance (ESG) bond. The bank has rushed to issue ESG bonds at home and aboard in recent years, starting with its first won-denominated sustainable bond sale worth 200 billion won in February 2019. It sold a 750 billion won won-denominated sustainable bond in 2020 and issued foreign currency-denominated sustainable bonds in 2019, 2020, and 2021. (Reporting by Hye-rim Pi)