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Corporate direct financing dips 24% in Aug.

Sept. 26, 2017 - 09:32 By Yonhap
South Korean companies' equity and debt sales plunged more than 24 percent in August from the previous month due mainly to one-off and seasonal factors, government data showed Tuesday.

Local companies raised 10.9 trillion won ($9.6 billion) by selling stocks and bonds last month, down 24.4 percent from July, according to the data from the Financial Supervisory Service.

Stock sales, including seven initial public offerings, tumbled 69.4 percent on-month to 389.3 billion won in August.

The financial watchdog attributed the nosedive to a one-time factor: July's IPO worth slightly over 1 trillion won by biopharmaceutical firm Celltrion Inc. on the secondary KOSDAQ market.

The value of corporate bonds floated in August, including bank bonds and asset-backed securities, sank 20.1 percent on-month to 10.5 trillion won. The drop came mainly because nonfinancial firms pre-emptively sold debt in the first half, the FSS said.

An ABS is a security in which its income payments and hence value are derived from and backed by a pool of underlying assets.

The outstanding value of bonds issued by South Korean companies came to 436.5 trillion won as of the end of last month, up 2.5 trillion won from a month earlier.

In the first eight months of this year, local companies sold a combined 107.4 trillion won in shares and bonds, up 34.8 percent from the same period a year earlier, according to the data. (Yonhap)