Kyobo Securities Issues 10 Billion KRW in 12548th Equity-Linked Derivative Bond, Principal-Protected Structure Linked to Samsung Electronics with Contingent Coupon
Kyobo Securities is issuing 10 billion KRW in 12548th equity-linked derivative bond linked to Samsung Electronics common stock. This bond is classified as normal risk with principal protection at maturity, a 3-year term, and monthly coupon payments.
Coupons of 0.79% per month (9.48% per annum) are paid if the underlying closes at or above 65% of the initial strike price on each monthly observation date. Automatic early redemption occurs if the underlying is at or above 75% of the initial strike on semi-annual dates. If conditions are not met, no coupon is paid and only principal is returned at maturity.
The issuer Kyobo Securities has a credit rating of AA- and this bond is unsecured and not protected by the deposit insurance system. Proceeds will be used for hedging and financial investments. This issuance does not dilute existing shareholders but slightly increases the company's leverage.
[AI Summary]Kyobo Securities' 10 billion won ELB issuance is capital neutral with no equity dilution. The principal-protected structure offers contingent coupons tied to Samsung Electronics' stock performance, with credit risk from the issuer. Market interest rates and Samsung's stock price will affect the actual return.