"Record-High Issuance and Lowest-Ever Spread Achieved"
IBK Industrial Bank of Korea announced on the 17th that it has successfully issued global bonds totaling USD 1 billion.
This issuance marks the first Korean paper offering since Israel conducted an airstrike on Iran on the 13th.
Through this issuance, IBK raised USD 500 million in 3-year floating rate notes and USD 500 million in 5-year fixed rate notes, securing a total of USD 1 billion in a single offering?the largest amount ever for the bank.
The 3-year notes were priced at a spread of 58 basis points (1bp = 0.01 percentage point) over the Secured Overnight Financing Rate (SOFR), while the 5-year notes were priced at a spread of 47 basis points over the 5-year U.S. Treasury yield. Both tranches set record-low spreads for the second consecutive year.
IBK explained that, despite increased market volatility due to armed conflict in the Middle East, it made a bold and preemptive decision to issue the bonds in anticipation of the possibility that such issues could become prolonged.
The bank reported that, by adopting a dual-tranche structure to attract a wide range of investors, it achieved strong demand with orders totaling USD 8.1 billion?the largest ever?making the issuance a success.
An IBK official stated, "Through meticulous market monitoring, we were able to identify the optimal timing and best strategy, which enabled us to set a new record for demand. It is especially meaningful that, even amid geopolitical risks, we have reaffirmed the solid standing of Korean paper based on our strong credit rating as a policy bank."
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