[Asia Economy Reporter Lee Seon-ae] Last year, the transaction amount of repurchase agreements (Repo) between institutions was 2,331.8 trillion won, an increase of 5.3% compared to the previous year. This is about 1.7 times the size compared to five years ago in 2017. The average daily balance was 126.4 trillion won, an increase of 18.8% compared to the previous year.
According to the Korea Securities Depository on the 18th, the inter-institutional repo market grew from about 3.8 times the size of the call market in 2017 to about 12 times in 2021 based on the average daily balance. A repo is a bond issued by financial companies with the condition to repurchase it later with added interest.
By transaction period, the 1-day repo was the largest at 86.4 trillion won (68.2%), followed by 7-10 day repos at 18.7 trillion won (14.8%), and over 10-day repos at 14.4 trillion won (11.4%).
By industry, domestic securities companies had the largest transaction size with an average daily selling balance of 57.1 trillion won. Next were asset management companies (45 trillion won) and domestic securities companies (trusts, 9.8 trillion won).
By collateral securities, government bonds accounted for 59.1% of the total with an average daily balance of 79.2 trillion won. Financial bonds followed with 37.9 trillion won (28.2%), special bonds 7.1 trillion won (5.3%), Monetary Stabilization Bonds 5.1 trillion won (3.8%), and corporate bonds 3.9 trillion won (2.9%).
By transaction currency, the Korean won accounted for 115.2 trillion won (91.1%), and foreign currency accounted for 11.2 trillion won (8.9%).
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