Government to Issue KRW 11.9 Trillion in Treasury Bonds in April

[Asia Economy Reporter Kwangho Lee] The government will issue government bonds worth 11.9 trillion won in April through a competitive bidding process. A temporary measure to strengthen the capacity to underwrite government bonds will also be implemented in the second quarter of this year.

The Ministry of Economy and Finance announced on the 26th, in the 'April 2020 Government Bond Issuance Plan and March Issuance Performance,' that it will issue 2.35 trillion won of 3-year government bonds, 2.2 trillion won of 5-year government bonds, 2 trillion won of 10-year government bonds, 700 billion won of 20-year government bonds, 2.9 trillion won of 30-year government bonds, and 750 billion won of 50-year government bonds.

If the general public submits a bid through a government bond primary dealer (PD) by the day before the bidding, they will be given priority allocation within 2.23 trillion won, which is 20% of the competitive bidding issuance amount excluding the 50-year bonds.

Each PD can additionally purchase government bonds within 10-35% of the competitive bidding winning amount within 3 business days after the winning date for each bond maturity.

Strip bonds (principal and interest separated) will be supplied up to 160 billion won per maturity. For 10-year and 30-year bonds, 210 billion won will be supplied.

Strip PDs can purchase up to 20 billion won.

Inflation-linked government bonds can be applied for on the bidding day and the following day for 10-year bonds within 10% of the monthly issuance amount of 100 billion won per PD.

The general public can apply through PDs up to 10% of the monthly inflation-linked government bond issuance amount, which is 10 billion won, by the 10-year bond bidding day.

To enhance government bond liquidity, an exchange between matured inflation-linked bonds and benchmark inflation-linked bonds will be conducted on a scale of 100 billion won.