DB Securities Decides to Issue 150 Billion KRW Hybrid Bonds to Strengthen Financial Soundness and Operating Funds
DB Securities decided on June 9, 2026 to privately issue 150 billion KRW of hybrid capital securities. This represents the full amount of the 150 billion KRW issuance limit approved by the board on May 26, 2026, with the purpose of raising operating funds and enhancing financial soundness through capital expansion.
The securities have subordination clauses, ranking senior to common stock but junior to general creditors in liquidation, and include optional interest deferral and maturity extension features. The issuance is allocated to 15 financial institutions including KDB Capital and Hana Capital, each subscribing from 3 billion to 20 billion KRW.
As there is no equity conversion right, there is no dilution for existing shareholders. The capital expansion improves financial soundness and credit rating. However, the 150 billion KRW debt-like capital adds interest burden, with a coupon rate of 5.9% and step-up conditions that may increase costs with future rate adjustments.
[AI Summary]DB Securities' hybrid bond issuance aims to strengthen financial stability through capital expansion without diluting existing shareholders. However, the large debt-like capital increases interest expenses, potentially impacting net income, especially if rates rise. Short-term balance sheet improvement is expected, but long-term interest cost management is crucial.
KOSPI Filing Information
Report On Major Events (Decision On Issuance Of Debt Securities Recognized As Capital)