Shinhan Bank Issues Kangaroo Bond Worth 400 Million AUD

In an Unstable Funding Market... Both Raised Amount and Interest Rate Exceed Targets

[Asia Economy Reporter Yu Je-hoon] Shinhan Bank announced on the 9th that it successfully completed a public offering of Kangaroo bonds worth 400 million Australian dollars (approximately 260 million US dollars). The Kangaroo bonds were issued with a 3-year maturity and a floating interest rate structure, set at the 3-month Australian dollar swap rate (BBSW) plus 1.95%.

Earlier this month, Shinhan Bank conducted face-to-face meetings with major investors in Australia and Asia, closely examining market trends and investment demand. They secured orders exceeding the initial issuance amount, playing a pioneering role in resuming Korean foreign currency bond issuance. Despite growing investor concerns about Korean bonds amid recent domestic short-term financial market tightening, the bank succeeded in issuing with excess demand through solid performance and active communication with investors, which the market views as a fruitful result of continuous efforts to expand the Australian investor base.

In particular, Shinhan Bank demonstrated its differentiated foreign currency funding capabilities in the Australian capital market by issuing Kangaroo bonds consecutively twice since September 2020, following Samurai bonds in October during the second half of the year marked by increased volatility in international financial markets. This issuance also solidified its leading position in the ESG funding market as the third Environment, Social, and Governance (ESG) bond issuance this year.

A Shinhan Bank official stated, "This issuance is significant as the financial authorities’ proactive response amid recent unstable domestic funding market conditions played a crucial role in alleviating overseas investors’ concerns, and both the initial target size and interest rate were exceeded. We hope the results of this issuance will somewhat help improve foreign currency funding conditions for domestic institutions, and we will continue to communicate with investors to diversify the funding market and establish a stable funding base."

Meanwhile, the Kangaroo bond issuance was jointly underwritten by ANZ (Australia and New Zealand Banking Group), Credit Agricole CIB, Mizuho Securities, and Nomura Securities, with Shinhan Investment Corp. participating as a co-manager.