[Asia Economy Reporter Lee Seon-ae] Samsung Securities' special bond offering with an annual interest rate in the 4% range sold out within 27 minutes of the sales opening. Due to the sharp rise in interest rates, individual investors' funds are increasingly moving to bonds, which are considered safe assets.
According to Samsung Securities on the 18th, the special bond with a limit of 30 billion KRW, sold through Samsung Securities' mobile app 'mPOP' starting at 9:30 AM on the 15th, was sold out within 27 minutes of the sales opening. The number of bond transactions was 30 times higher than usual, and based on traffic, bond trading accounted for 82% of the total financial product menu traffic, marking an all-time high, according to Samsung Securities. It is analyzed that customers were able to make quick investment decisions because these were senior bonds with a pre-tax annual interest rate of up to 4%. Sa Jae-hoon, Vice President and Head of Channel Sales Division at Samsung Securities, explained, "We felt the enthusiasm for bond investment, which has emerged as an investment cheat key in the high-interest era, as the bonds sold out faster than expected and there were requests for additional quantities."
Samsung Securities has sold 3.1 trillion KRW worth of bonds from the beginning of this year until the 15th, which is an 82% increase compared to the end of June last year. In particular, the subscription amount in June by customers who directly purchased bonds through online channels reached 60 billion KRW, more than six times the monthly average of last year. Korea Electric Power Corporation (KEPCO) bonds, issued to cover accumulated deficits, have been sold out every time they are offered. This indicates that the era of bond investment becoming popular among the public is approaching, as individual investors' funds are flocking to bonds. This is because, due to the stock market crash, bonds are attractive as they are safe and can yield returns exceeding deposit interest rates.
According to the Korea Financial Investment Association, as of the 17th of this year, the net purchase amount of bonds by individuals in the over-the-counter bond market reached 6.3456 trillion KRW, more than double the 2.9457 trillion KRW during the same period last year. Considering that it was 1.9587 trillion KRW in 2020, not even reaching 2 trillion KRW, this represents explosive growth. An industry insider said, "Due to the stock market crash, there is a mood of moving from the stock market to the bond market," adding, "It seems that the guarantee of stable returns of over 4% annually depending on the bond is an attractive factor."
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