Hyundai Motor Securities Issues KRW 14.99B DLB with Low Risk Rating & Effective 3.000% Yield – Neutral Fundraising
Hyundai Motor Securities will issue the 605th Series Derivative-Linked Bonds (Low Risk) on June 12, 2026, totaling KRW 14,992,500,000. Each bond has a face value of KRW 10,000, issue price of KRW 9,995, and 1,500,000 securities will be issued via electronic registration.
The underlying asset is the USD/KRW reference rate. At maturity (Sept 10, 2026), if the rate is ≥ KRW 2,000, the pre-tax yield is 3.010% p.a.; otherwise, 3.000% p.a. Over the past 20 years, the highest rate was KRW 1,573.60, making the 2,000 threshold virtually unreachable, so investors will effectively receive a fixed 3.000% yield.
This DLB is not protected by the Depositor Protection Act, and is an unsecured, unsubordinated bond with the issuer's credit rating of AA- (from KIS, KOREARATING, and NICE). Early redemption is possible at ≥95% of fair value but may incur principal loss, and the bond is unlisted with low liquidity.
Proceeds will be used for hedging transactions in the underlying asset and derivatives, as well as investments in financial products. Issuance may be canceled if total subscription is below KRW 100 million.
[AI Summary]This DLB issuance is a routine fundraising activity, neutral for the stock price. Investors gain a low-risk, near-fixed return but face risks from lack of deposit insurance and limited liquidity. No material positive or negative impact on Hyundai Motor Securities' equity value.