이 기사는 2020년 02월 11일 08:00 thebell 에 표출된 기사입니다.

South Korea’s state lender Export-Import Bank of Korea (Eximbank) returns bond markets by successfully selling five-year global bonds to overseas investors despite market uncertainty due to coronavirus concerns across the world.

The state lender has successfully sold 500 million dollars five-year bonds to overseas investors on February 6. The bond’s spread, 47.5 basis points over the five-year U.S. treasury yield, was the narrowest among the capital instrument issued to date in South Korea, except for sovereign debts, since the 2008-2009 global financial crisis.

The latest global bond issuance was its first bond offering since June of 2019. The lender’s issuance of Korean paper, which refers to foreign currency debt issued by South Korean entities abroad, has shrunk since the second half of last year. It is said Eximbank could not aggressively raise money through bond issuance as police launched an investigation into the bank for receiving bribes in the process of selecting bookrunners for earlier Korean paper issues.

As a complementary measure to ensure the transparency of the process, Eximbank announced that it would create the Assessment Committee that oversees the overall process of selecting bookrunners.

Eximbank selected Bank of America Merrill Lynch, JP Morgan and Morgan Stanley as its bookrunners last month. It has chosen only U.S.-based houses for the latest bond issuance, whereas it has included Europe-based houses in the past.

Eximbank’s latest bond offering drew strong demand from investors. The order book amounted to 3.2 billion dollars, attracting active and wider participation from investors across Asian, European and U.S. markets, with the issue oversubscribed seven times.

Initially Eximbank planned to start its pricing process around February 3, which made other Korean paper issuers avoid that date for their bond sale. Normally, when Korean paper issuers sell bonds, they try not to overlap their pricing date with others who sell dollar-denominated bonds, so that demand doesn’t disperse.

The problem was that there was zero Asian institution who issued global bond during the period due to the coronavirus outbreak. As bond sale was halted for almost 15 days, it became harder for Asian institutions to proceed with their bond offering amid absence of reference for the pricing.

Despite drop in issuance volume, market watchers looked forward to the Eximbank’s bond issuance on the back of the rebound in U.S. stocks and the lender’s excellent credit rating (AA).

Eximbank carefully estimated the timing to raise money stably and picked February 5 as its pricing date. Hyundai Capital America also planned its bond sale on that day. Demand from Asian investors somewhat dispersed as two Korean institutions appeared in the market.

For Hyundai Capital America, 16 percent of its bonds were allocated to Asia and Europe. Normally the company’s allocation for Asia and Europe amounted to 30 percent. When selling bonds in June of 2019, the allocation for the regions grew to almost 50 percent thanks to demand from Chinese investors.

(By reporter Pi Hye-rim)