Kimchi bond

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Kimchi bond
Hangul 김치본드;
김치채권 (rare)
Hanja none;
김치債券
Revised Romanization Gimchi Bondeu;
Gimchi Chaegwon
McCune–Reischauer Kimch'i Pondŭ;
Kimch'i Ch'aekwŏn

A Kimchi bond is a non-won-denominated bond issued in the South Korean market. The name refers to kimchi, a Korean side dish.[1] Woori Bank, which is credited with coining the term, defines it as solely referring to bonds from foreign issuers, a definition echoed by the Ministry of Finance and Economy.[2][3] However, in practise, the term is also used to refer to non-won-denominated bond issuance by domestic entities.[4][5] Deutsche Bank credits itself as having executed the first kimchi bond transaction, a US$100 million two-year floating rate note sold by South Korean company SK Global, but the first foreign company to sell non-won-denominated bonds in the South Korean market was Bear Stearns.[2][4] Although foreign firms had long been permitted to issue won-denominated bonds, typically referred to as Arirang bonds, permission for them to issue foreign currency-denominated bonds was slower in coming. Permission was finally granted due to the strength of the won in 2005.[3][6]

References[edit]

  1. ^ Gwon, Yeong-seok (2006-05-24). "‘김치본드’ 내달 처음으로 선보인다 (Announcement: first 'Kimchi Bonds' next month)". The Hankyoreh. Retrieved 2007-07-06. 
  2. ^ a b "'Kimchi' bonds for Koreans". The Standard. 2006-05-25. Retrieved 2007-07-06. 
  3. ^ a b "Supplement to MOFE Press Release: 2nd Meeting of the Financial Hub Initiative Committee". Ministry of Finance and Economy. 2006-06-19. Retrieved 2007-07-06. 
  4. ^ a b Deutsche Bank Group Profile: Korea (PDF). Deutsche Bank. October 2006. Archived from the original on 2007-05-08. Retrieved 2007-07-06. 
  5. ^ "SK Shipping prepares kimchi". Jane's Transport Finance. 2007-06-21. Retrieved 2007-07-06. 
  6. ^ Kim, Jung-min (2005-04-24). "Woori considers issuing dollar-denominated 'kimchi bond'". Herald Media. Retrieved 2007-07-06.