Shinhan Bank Successfully Issues $500 Million Foreign Currency Subordinated Bonds

Shinhan Bank announced on the 9th that it successfully completed a public offering of $500 million (approximately 677 billion KRW) in foreign currency subordinated bonds.

This subordinated bond is a 10-year fixed-rate bond, with a coupon rate set at 5.75% per annum, which is 1.40% above the 10-year U.S. Treasury yield.

Prior to the bond issuance, Shinhan Bank held investor presentations in Asia and the Americas, emphasizing proactive responses to various risk factors such as global financial market uncertainties and highlighting high stability.

Additionally, due to the rarity of long-term bonds issued by Korean institutions, there was strong investor demand, with orders exceeding seven times the issuance amount at one point, achieving the lowest spread in the history of foreign currency capital securities issuance by Korean financial institutions.

Since the second half of 2020, Shinhan Bank has linked all foreign currency public bonds to ESG criteria, and this foreign currency subordinated bond was also issued in the form of a social bond. The proceeds from this bond will be matched with loan products targeting financially vulnerable groups.

A Shinhan Bank official stated, “We pursued this bond issuance as a preemptive capital management measure amid tightening capital-related regulations such as countercyclical capital buffers,” adding, “It is significant as it marks the resumption of capital securities issuance during a period of expanding global financial market uncertainties.”

Meanwhile, Bank of America Merrill Lynch, Citigroup Global Markets Securities, Cr?dit Agricole, HSBC, Soci?t? G?n?rale, and Wells Fargo participated as joint lead managers for this issuance.